Tag Archives: mars

The Sticky and Complicated Future of Chocolate

the modern mocha is a bittersweet concoction of imperialism, genocide, invention, and consumerism served with whipped cream on top.”[1] ― Sarah Vowell

Humorist Sarah Vowell captures much of the history of chocolate (and coffee) in this little quip. However, the history of chocolate is long and its social, economic, and political implications are vast. Putting the positive impacts of invention aside, the negative impacts of imperialism and consumerism more than linger. They have resulted in gross economic inequities and lasting environmental and social damage, particularly in the production end of the cocoa supply chain. It’s going to take the force of consumerism and capitalism to right these inequalities and bring about sustainability.

Approximately 70% of the world’s cocoa is produced in West Africa by small farms spread out across the area. In the 1980s cocoa farmers received approximately 16% of the chocolate profits, today this percentage has been greatly reduced to 3%.[2] Cocoa farmers are not organized and have little bargaining power against more organized buyers.

Profit shared on cocoa supply chain
Figure 1: Farmers share of chocolate profits is small and has been in decline since the 1980s when global cacao prices were regulated. In the 1980s farmers were receiving around 16% of the chocolate profits. Martin, Carla D. “Introduction.’” Chocolate, Culture, and the Politics of Food. Harvard Extension School: Cambridge, MA. 24 Jan. 2018. Class Lecture. [3]
The 2018 Cocoa Barometer highlights the many challenges for cacao farmers, including volatile pricing. From September 2016 – February 2017, farmers experienced a 30%-40% decline in income (Ghana farmers were protected by this price drop through government subsidies). Although prices are on the rise again, the overall trend the past 60 years is a decline in prices (see figure 2). With farmers having little, to no, protection from their governments they are hardest hit by market fluctuations, while others on the value chain will see an increase of their profit margins, even if only temporary.[4]

2018 Cocoa Barometer Long-term cocoa price trends
Figure 2: The average production of Ivorian cocoa in the seasons 2010/11, 2011/12, 2012/13, 2013/14, 2014/15 and 2015/16 was around 1,600,000 metric tonnes (mt). Cocoa production in 2016/17 and 1017/18 is around 2,000,000 mt, an increase of about 400,000 mt. (ICCO Quarterly Bulletins) The overproduction in 2016/17 was around 300,000 metric tonnes, according to the ICCO Quarterly Bulletin, Volume XLIV no 1, page 50, table 1.[5] Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018.http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf
Farmers in West Africa make well below a living wage of $2.51 per day, averaging $0.78 per day (FairTrade).[6] The Cocoa Barometer asserts that the price drops are directly related to improved production due to new farming areas created from deforestation. More than 90% of West Africa’s original forests are gone.

An estimated 2.1 million children work in West African cocoa fields. Structural issues such as poverty, lack of schools, and infrastructure also contribute to the high levels of child labor.[7] Efforts in the past few decades to end child labor, preserve the environment, and to balance these inequities have been challenging and difficult to measure. Currently, third party certification bodies have been the only levers toward implementing and measuring sustainability efforts as well as signals to consumers as to where, and how, their chocolate products are sourced.

Major Certification Bodies
Three major certification bodies associated with cocoa. Note Utz and Rainforest Alliance has merged and will announce new standards in late 2019 for the New Rainforest Alliance.

The three main certification entities are Fairtrade, Utz and the Rainforest Alliance. Fairtrade Standards are designed to support the sustainable development of small producer organizations and agricultural workers in the poorest countries in the world.[8] Similarly, Utz certification was created to show consumers that products were sustainably sourced. Rainforest Alliance certification meant farmers met rigorous environmental and social standards.[9] In January 2018, Utz merged with the Rainforest Alliance. The New Rainforest Alliance plans to publish a singular program at the end of 2019.[10]

Certification and bean-to-bar efforts in the specialty chocolate market have many success stories, but compared to the global consumption of chocolate, these efforts have only made a dent.[11] The Fine Cacao and Chocolate Institute (FCCI) reports, with caveats intended to illustrated the challenges of obtaining this data, that there are 481 specialty chocolate makers and manufacturers worldwide that represent approximately 6% of the annual global production of cacao.

International Cocoa Organization, ICCO, ultrapremium cacao, fine cacao, bulk, certified
Figure 3: Ultrapremium fine and Fine cacao comprises 246,000 tonnes (6%) of the 4,031,200 tonnes of cacao produced annually (ICCO 2015). [12]
The FCCI defines this market segment as those chocolate makers and manufacturers that choose to purchase specialty cacao at a premium price for purposes of taste quality and/or sustainability reasons.[13] Within this small group, sustainability is but a factor in paying the price premium, but not necessarily a primary factor. In order for sustainability initiatives to have any meaningful impact to cocoa farmers the major chocolate manufacturers need to take the lead and invest in best practices throughout their supply chain that address the environmental, social, and economic challenges their farmers face.

Cocoa Barometer, Certified Cocoa, 2017, Mondelez International, Nestle, Mars, Hersheys, Ferrero, Lindt und Sprungli
Figure 4. Data kindly provided by the companies. Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf

Recent Commitments by the Majors / Certifications & Goals

Mondelēz International (a subsidiary of Kraft)
Chocolate Brands: Cadbury, Alpen Gold, Côte d’Or, Toblerone, etc.
Certification provided by FLOCERT through a private labeling partnership.

In 2012 Mondelēz International invested $400 million to create its Cocoa Life program. The program plans to empower 200,000 cocoa farmers and one million community members by 2022. In April 2018 Mondelēz International reported that they have reached 120,500 cocoa farmers, in a variety of programs and they reached 35% certified cocoa.[14]

Mondelēz  International, Cocoa for Life, 2017 Progress
Figure 5: Cocoa Life infographic showing Mondelēz 2017 Progress in Numbers. Includes increases in sustainably sourced cocoa and reach to farmers and communities from previous year.[15]
Cocoa Life is tied to the UN Sustainability Development Goals (SDGs), with an emphasis on Goals 1 (no poverty), among others. Cocoa Life has partnered with local governments and NGOs to build community-centric Child Labor Monitoring and Remediation Systems (CLMRS), which educate farming communities on the dangers of child labor, identify children at risk, and remediate cases with its local partners. Cocoa Life CLMRS programs have started in Ghana and continue to increase. Roll out of CLMRS in Côte d’Ivoire will begin in 2018. Nestlé has also implemented CLMRS program into its sustainability programs.[16]

Mondelēz, CLMRS, 2017
Figure 6: Child Labor Monitoring and Remediation Systems (CLMRS) deployed by Mondelēz International in 2017 with plans to ramp up in 2018.[17] Mondelēz International. Cocoa Life 2017 Progress Report: From Cocoa Farmers to Consumers Connection Both Ends of the Supply Chain. P. 21. April 2018. Web. April 2018. https://www.cocoalife.org/~/media/CocoaLife/en/download/article/Cocoa_Life_Progress_Report_2017.pdf

Nestlé
Chocolate Brands: Smarties, Nestlé Crunch, Butterfinger, KitKat, etc.
Certifications: Utz and Fairtrade

In their detailed, first report (2017), co-authored with the International Cocoa Initiative (ICI), Nestlé asserts that certification is not enough and that additional support for the farmer is needed. In fact, Nestlé asserts that certification drove the issue of child labor “underground” as farmers would hide any child laborers when inspectors came around.[18] While Mondelēz set up CLMRS in Ghana, Nestlé set up its CLMRS in Côte d’Ivoire and report a 51% reduction of child labor in a recent sample of 1,056 children over a two-year period. [19]

Nestle, Child Labour, Child Labor, 2017 Corporate Responsibility Report
Figure 7: Nestlé targets child labor by its Child Labor and Monitor Remediation Systems (CLMRS) in Côte d’Ivoire. Nestlé hopes to scale the successful parts of the program to meet the goals of its Cocoa Plan.[20]
Nestlé is also investing in Community Liaison People (CLPs) to educate the community of the dangers of child labor. They are targeting women and mothers as they are more likely to invest their income and education into their family. The CLPs are local young people who are paid to train and the cost of the CLPs are split between Nestlé and the farmer. Remediation is highly individualized, but these activities are ones Nestlé continues to invest.[21] Nestlé hopes to scale their more successful initiatives to meet the goals of its Cocoa Plan, which is set to reach 57% cocoa certification by the end of 2020.

Nestle, CLMRS, Child Labour Monitoring and Remediation System, ICI, International Cocoa Initiative
Figure 8: An overview of how Nestlé’s Childe Labour Monitoring and Remediation System (CLMRS) works by engaging the community, assigning monitors, monitoring, reporting, validation, analysis, recommends remediation, remediation carried out by partners, monitoring continues ensure remediation is carried out.[22]  Nestlé. Nestlé Cocoa Plan Tackling Child Labour 2017 Report. Web. P.23 April 2018. https://www.nestlecocoaplanreport.com/sites/default/files/2017-10/NestleCocoaPlanReport2017_EN_0.pdf
Nestle, Cocoa Plan, CLMRS, Certified Cocoa
Figure 9: Infographic on Nestlé Cocoa Plan Challenges and Ambitions in CLMRS program reach and tonnes of certified cocoa.[23] Nestlé. Nestlé Cocoa Plan Tackling Child Labour 2017 Report. Web. P.49 April 2018. https://www.nestlecocoaplanreport.com/sites/default/files/2017-10/NestleCocoaPlanReport2017_EN_0.pdf

Ferrero
Chocolate Brands: Ferrero Pralines, Nutella, Kinder Chocolate
Certification is conducted by Utz, Fairtrade, and Rainforest Alliance.[24]

According to its 2016 Social Responsibility Report Ferrero has made a commitment to 100% certified cacao by 2020 and 75% by the end of 2018.[25]

Ferrero, Sustainability Report, Certified Cocoa
Figure 10: Ferrero touts its success toward reaching its certification goals.[26] Ferrero. Sharing Values to Create Value Corporate Social Responsibilty Report 2016. Ferrero. Web. P. 170 https://s3-eu-west-1.amazonaws.com/ferrero-static/globalcms/documenti/2807.pdf
In its April 2018 Cocoa Barometer reports Ferrero is 70% certified (figure 4), and by its own reporting, on track to meet its goal of 75% cocoa certification (figure 10).

Ferrero reports partnerships with cacao cooperative ECOOKIM, the largest in Côte d’Ivoire, which takes part in the Fairtrade Africa program “It Takes a Village to Protect a Child.” Similar to CLMRS, the program establishes a Child Labor Committee to raise awareness about child labor, create child protection policy, and monitor activity at the community level. Ferrero reports that 9,413 children benefitted from this program. [27]

Ferrero also works with Save the Children to work toward ending child labor. It reports 1.2 million children are forced to work in hazardous conditions, however, Ferrero has set relatively modest goals of reaching 500 children, 7,500 members of 10 communities, and 100 representatives of local institutions.[28]

Ferrero, Save the Children, Cocoa, Sustainability, Community Development
Figure 11: Ferrero reports modest results on in their efforts to address child labor.[29]   Source: Save the Children, December 2016 – Protection des enfants vulnérables dans les communautés productrices de cacao dans le département de Soubré en Côte d’Ivoire – Ajournement pour Ferrero. Ferrero. Sharing Values to Create Value Corporate Social Responsibilty Report 2016. Ferrero. Web. P. 182 https://s3-eu-west-1.amazonaws.com/ferrero-static/globalcms/documenti/2807.pdf
In January Ferrero announced it planned to acquire Nestlé’s U.S. confectionary business for $2.8 billion in cash making Ferrero the third largest confectionary company in the U.S.[30] It is anticipated that Ferrero will realign their sustainability goals after the acquisition of Nestlé, but their goals are currently similar.

The Hershey Company
Popular Chocolate Brands: Hershey’s Chocolate Bar, Cocoa, Kisses, and Baking chocolates, Kit Kat, Almond Joy, Mounds, Reese’s, York.
Certification is conducted by Utz, Fairtrade, and Rainforest Alliance.[31]

Hershey, Open source map, cocoa farms, sustainability, transparency
Figure 12: Hershey Source Map for Reese’s Peanut Butter Cups. Pictured above is a zoomed in version of W. Africa. Users can zoom in and view the name of Cocoa Coop, educational location, or an area they obtain cocoa. The map also shows locations around the world for ingredients such as milk and sugar, plus other sources of chocolate in South American. Hershey also has a source map for its Hershey’s Milk Chocolate with Almond Bars. [32] https://open.sourcemap.com/maps/589e10c1e4bac0b357bc3d5f
Hershey, Sustainablity Goal
Figure 13: Hershey reports its on track to reach its goal of 100% certified cocoa by 2020.[37]   The Hershey Company. 2016 Corporate Social Responsibility Report. 2017. Web. April 30, 2018. p. 27. https://www.thehersheycompany.com/content/dam/corporate-us/documents/csr-reports/2016-hershey-csr-report.pdf
In its 2016 Corporate Social Responsibility Report, The Hershey Company highlights progress in their Learn to Grow agriculture and empowerment program, serving 48,300 farmers in West Africa.[33] The report also highlights its Energize Learning program, which provides Vivi energy bars to students improving overall nutrition. The program is a partnership with the Ghana School Feeding Program and Project Peanut Butter and 50,000 kids in Ghana receive 50,000 Vivi bars every day.[34] Hershey also partnered with The World Cocoa Foundation’s (WCF) Climate Smart Cocoa Program to address climate change impacts to cocoa growing regions. The partnership will pilot a series of programs to develop “climate-smart” best practices to inform the Learn to Grow curriculum and through Hershey’s CocoaLink program knowledge sharing between farmers will be allowed via low-cost mobile technology.[35] Hershey’s report indicates that it is on schedule to reach its 100% certified goal by 2020.[36] In April 2018 the Cocoa Baramoter reports Hershey reached 75% (see figure 4). Also in April 2018, Hershey announced the creation of its Cocoa for Good sustainability programs

Beyond certification, Cocoa for Good seeks to address the most pressing issues facing cocoa-growing communities. The strategy is to target four key areas: increase family access to good nutrition, elimination of child labor and increase youth access to education opportunities, increase household incomes for women and men, zero deforestation and increased agroforestry. The announcement came with a $500 million commitment by 2030 and like Mondelēz International and Mars, aligns its strategy to contribute to the goals of the United Nations Sustainable Development Goals.[38]

Mars
Chocolate Brands include: M&M, Snickers, Twix, Dove, Milky Way, etc.
Certification is conducted by Utz, Fairtrade, and Rainforest Alliance.

In September of 2017, Mars announced its Sustainable in a Generation Plan, with a pledge to invest $1 billion over the next few years to address threats such as climate change, poverty in its value chain, and scarcity of resources.[39] This is across all their raw products, not just cocoa. Oxfam will serve as an advisor to their Farmer Income Lab, which aligns with the United Nations Sustainability Development Goal 1 (no poverty). The Farmer Income Lab will seek to create solutions through research for farmers working in Mars’ supply chain in developing countries.[40] Other actions include improving cocoa farming methods, pests and disease prevention, and unlocking the cocoa genome.[41] Engagement with others actors in the cocoa industry is also key, such as the World Cocoa Foundation and CocoaAction. Mars’ Chief Sustainability & Health and Wellbeing Officer, Barry Parkin, also serves as Chairman of World Cocoa Foundation.

Mars, Cocoa Sustainability
Figure 14: Mars identifies that 5 million cocoa farmers are impacted, but focuses mainly on addressing technology issues in farmer in a belief it will fix the social challenges that farmers face, such as a extreme poverty, child labor, and infrastructure concerns included in other sustainability plans.[47]
Mars may lay claim as the first major chocolate company to commit to 100% certified chocolate by 2020, but its progress has lagged, reporting 50% of their cocoa being certified in 2016[42] and the same percentage being reported by the cocoa barometer in 2018 (figure 4). During this same time frame Ferrero and Hershey have demonstrated increases in certification of cocoa reporting 70% and 75% certificated cocoa, respectively (figure 4).[43] Their website lacks a corporate social responsibility report and the information available on their site appears to be written in 2016, except for recent press releases and Income Position Statement.[44] For example Mars’ claim to be the only major manufacturer to work with all three major certification organizations Utz, Rainforest Alliance, and Fairtrade International is outdated.[45] Hershey and Ferrero include these bodies in their 2016 sustainability reports.

Until the recent announcement of Sustainable in a Generation Plan, Mars’ approach, as described on their website, leans more toward improving farmer yield through technology (fertilizer, farming techniques, mapping the cacao genome) than increasing living wages and address child labor. A press release by Frank Mars in April 2018 urges collaborative scientific approach and extolls their work on breeding higher yield cocoa plants for improving farmer incomes.[46] However, higher yields do not always improve farmer incomes. As previously mentioned, the recent Cocoa Barometer report suggests that higher production results in driving down price, thus less income for farmers. Perhaps Mars’ real progress is tied to the progress of the World Cocoa Foundation.

World Cocoa Foundation (WCF) and CocoaAction

CocoaAction is a voluntary industry-wide organization that aligns the world’s leading cocoa and chocolate companies, cocoa producing governments, and key stakeholders on regional priority issues in cocoa sustainability run by the World Cocoa Foundation (WCF). The WCF member companies committed to CocoaAction include Mondelēz International, Nestlé, Ferrero, The Hershey Company, Mars, Incorporated, among others.[48] In November of 2017 a Framework of Action was announced by the WCF with the governments of Côte d’Ivoire and Ghana and major chocolate and cocoa companies to end deforestation, restore forest areas, and accelerate investment in long-term sustainable production of cocoa, and the development and capacity-building of farmers’ organizations and farmer’s income. Commitments also include participation of policy creation by farmers and extensive monitoring and reporting. The Framework of Action involves governments and companies that represent 80% of the global cocoa production and usage.[49] If implemented correctly, these commitments should go a long way in repairing the deforestation in West Africa. 

The Future of Chocolate

These efforts are welcome and it is promising that the majors can successfully  collaborate with governments, NGOs, and each other in the important effort to secure the future of chocolate and those that produce it. It is also encouraging to see the major manufacturers release sustainability reports, however, as barometer.org reports, many of their commitments fall well short compared to the actual scope of the problem. The commitment to reach 400,000 children by 2020 would only impact 18% of children in need (figure 15). Similarly meeting commitments to help farmers in CocoaAction would only reach 15% of farmers in need (figure 15). Regarding living income, farmers are only making $0.78 per day, 31% of the living wage of $2.51 per day (figure 15). The Cocoa Barometer report stresses that a living wage, among other factors, is a major component that these initiatives must include in their sustainability initiatives. From available data, all reports aspire to improve farmer income, either by improving productivity or identifying additional income generating activities. However, these plans do not set a living wage as a goal. As mentioned earlier in this article more production doesn’t always result in more income.

Cocoa Barometer, Scale of solutions vs problem, Cocoa Sustainability, CLMRS, CocoaAction, Cocoa Farmer
Figure 15: Scale of solutions vs. scope of the problem. The data for this infographic was publicly available in the case of CocoaAction and Fairtrade. The International Cocoa Initiative graciously provided their data. The authors of the Barometer do not wish to imply that these organisations are doing an insufficient job, but simply that the scale of the interventions chosen by the sector as a whole are dwarfed by the size of the challenges.[50]   Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf
The future of chocolate depends on the fate of cocoa farmers and their fate relies on untangling a mess of social and economic issues caused by imperialism, and exacerbated by free market capitalism and consumerism. The goals set forth in these reports are generally headed in the right direction, but their success is dependent on their ability to make their initiatives successful, then scale up on that success. Accountability and transparency among the industry and at the government level is also paramount to measure the effects of these initiatives. Consumers also have a role in making responsible purchases and applying pressure on corporations and governments to minimize inequality in the supply chain and certification plays an important role. If farmers continue to be marginalized, then there will be little incentive for a younger generation of farmers to take up the trade and chocolate may become a rare treat indeed.

 

Works Cited:

[1] Vowell, Sarah. The Partly Cloudy Patriot. Simon & Schuster. New York, New York. October 2002. p. 42

[2] Martin, Carla D. “Introduction.” Chocolate, Culture, and the Politics of Food. Harvard Extension School: Cambridge, MA. 24 Jan. 2018. Class Lecture.

[3] Ibid.

[4] Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. Web. p. 11. April 2018. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf

[5] Ibid. p. 52.

[6] Ibid. p. 6.

[7] Ibid. p. 3.

[8] Fairtrade. Aims of Fairtrade Standards. Web. May 8, 2018. https://www.fairtrade.net/standards/aims-of-fairtrade-standards.html

[9] The Rainforest Alliance. What Our Seal Means. Web. May 8, 2018. https://www.rainforest-alliance.org/

[10] Utz. Joining Forces: Utz and the Rainforest Alliance. April 24, 2018. Web. May 9, 2018. https://utz.org/merger/#QA_merger

[11] Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. p. 6. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf

[12] Martin, Carla. “Sizing the craft chocolate market.” Fine Cacao and Chocolate Institute (blog). August 31. 2017. Web. April 25, 2018. https://chocolateinstitute.org/blog/sizing-the-craft-chocolate-market/.

[13] Ibid.

[14] Mondelēz International. Cocoa Life 2017 Progress Report: From Cocoa Farmers to Consumers Connection Both Ends of the Supply Chain. P. 2. April 2018. Web. April 2018. https://www.cocoalife.org/~/media/CocoaLife/en/download/article/Cocoa_Life_Progress_Report_2017.pdf

[15] Ibid. p. 5

[16] Ibid. p. 21

[17] Ibid. p. 21

[18] Nestlé. Nestlé Cocoa Plan Tackling Child Labour 2017 Report. Web. P.24 April 2018. https://www.nestlecocoaplanreport.com/sites/default/files/2017-10/NestleCocoaPlanReport2017_EN_0.pdf

[19] Ibid. p. 22

[20] Nestlé. Introducing our first report on tackling child labour in cocoa. Web. April 2018. https://www.nestlecocoaplanreport.com/

[21] Ibid. 37

[22] Ibid. p. 23

[23] Ibid. p. 49

[24] Ferrero. Sharing Values to Create Value Corporate Social Responsibilty Report 2016. Ferrero. Web. P. 171 https://s3-eu-west-1.amazonaws.com/ferrero-static/globalcms/documenti/2807.pdf

[25] Ibid. p. 170

[26] Ibid. p. 170

[27] Ibid. 175

[28] Ibid. p. 181

[29] Ibid. 182

[30] Ferrero. Ferrero to Acquire Nestlé’s U.S. Confectionary Business. January 16, 2018. Web. May 9, 2018. https://www.ferrero.com/group-news/

[31] The Hershey Company. Our Certified Ingredients. Web. April 30, 2018. https://www.thehersheycompany.com/en_us/responsibility/good-business/responsible-sourcing.html

[32] Hershey. Hershey’s Milk Chocolate with Almonds Open Source Map. Zoom View. Web. April 2018. https://open.sourcemap.com/maps/589e10c1e4bac0b357bc3d5f

[33] The Hershey Company. 2016 Corporate Social Responsibility Report. 2017. Web. April 30, 2018. p. 11. https://www.thehersheycompany.com/content/dam/corporate-us/documents/csr-reports/2016-hershey-csr-report.pdf

[34] Ibid. p. 23

[35] Ibid. p. 12

[36] Ibid. p. 27

[37] Ibid. p. 27

[38] Hershey. Hershey Announces Cocoa For Good, the Company’s Half-billion Dollar Sustainable Cocoa Strategy. April 4, 2018. Web. April 30, 2018. https://www.thehersheycompany.com/content/corporate/en_us/news-center/news-detail.html?2340764

[39] Mars. Unveiling Our Sustainble in a Generation Plan. Sept. 5, 2017. Web. May 9, 2018. http://www.mars.com/global/press-center/newsroom/newsroom/unveiling-our-sustainable-in-a-generation-plan

[40] Farmers Income Lab. Challenges. Web. May 9, 2018. https://www.farmerincomelab.com/

[41] Mars. Income Position Statement: The Current Situation. Web. May 9, 2018. http://www.mars.com/global/about-us/policies-and-practices/income-position-statement

[42] Mars. Caring for the Future of Cocoa Out Approach. 2016. Web. April 2018. http://www.mars.com/global/sustainable-in-a-generation/our-approach-to-sustainability/raw-materials/cocoa

[43] Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf

[44] Mars. Caring for the Future of Cocoa Out Approach. 2016. Web. April 2018. http://www.mars.com/global/sustainable-in-a-generation/our-approach-to-sustainability/raw-materials/cocoa

[45] Ibid.

[46] Mars. Frank Mars Calls for the Cocoa Industry to Take a Collaborative Scientific Approach to Cocoa. April 26, 2018. Web. May 9, 2018. http://www.mars.com/global/press-center/newsroom/frank-mars-cocoa-collaboration

[47] Mars. Cocoa: Caring for the Future of Cocoa, Our Approach. Web. April 2018. http://www.mars.com/global/sustainable-in-a-generation/our-approach-to-sustainability/raw-materials/cocoa

[48] CocoaAction. World Cocoa Foundation. Web. April 2018. http://www.worldcocoafoundation.org/about-wcf/cocoaaction/

[49] World Cocoa Foundation. Two-thirds of Global Cocoa Supply Agree on Actions to Eliminate Deforestation and Restore Forest Areas. Nov. 2017. Web. April 2018.

[50] Fountain, A.C. and Hutz-Adams, F. Cocao Barometer Report. 2018. http://www.cocoabarometer.org/Cocoa_Barometer/Download_files/2018%20Cocoa%20Barometer%20180420.pdf

Moving to Mars: Climate Change and Cacao’s Undying Lov

Two hours. That is the amount of time I spent scouring databases and newspaper articles attempting to find scientific (or non-scientific) evidence that would demonstrate the importance chocolate has in our world today. More specifically, I was looking for something titled Chocolate: The Most Significant Food in History. The best I could find was a TIME.com article titled “9 Weirdest Uses for Chocolate.” It was very insightful. However, when considering the amount of chocolate that is produced and consumed in the world each year, the picture of importance starts to become more clear. For businesses and consumers, chocolate and cacao is a great product, and in high demand. For producers and farmers, it is an important cash crop and essential to survival.

Figure 1.

Producing and Consuming

Source: http://www.oecd.org/swac/publications/39596493.pdf

The relevance and importance chocolate and cacao cultivation have on the world economy cannot be understated. According to the International Cacao Organization (ICCO,) the world’s top ten chocolate producing companies did $80 billion USD in sales in 2017. (https://www.icco.org/about-cocoa/chocolate-industry.html) Even beyond the money and global markets, there is a great deal of cultural significance that could never be quantified. The World Cocoa Foundation estimates that Cacao directly affects the livelihoods of approximately 50 million people (http://www.worldcocoafoundation.org/our-work/programs/). For chocolate lovers, the news that climate change could significantly impact our access to chocolate was devastating. Major players such as MARS Inc. have made significant investments for this eventuality, and are looking to be prepared for changes in the cacao marketplace. This will undoubtedly have significant impacts on the producers of cacao and encourages a deeper look at methods to adapt the farming and production practices.

Chocolate might go away?

Despite the fear-mongering on the internet, this is not totally accurate. It is important to point out that cacao will not be going extinct anytime soon. It will, however, face a potentially sharp and significant decline in production. This means that by 2050, you may have less access too chocolate than you do at this very moment. My advice is to stock up.

Cacao trees really depend on very specific criteria to be met in order for them to grow, thrive, and produce fruit (Lecture). Cacao can essentially only be grown when the right conditions are met. Those conditions apply to which areas in the world cacao can grow in, the temperature it prefers, and the surrounding plants that shield and shade it. The picky nature of Theobroma cannot be understated.

The challenge that the world’s cacao producers are facing is climate change. Those very specific conditions are projected to be harder to meet in the very near future. According to the National Oceanic and Atmospheric Administration (NOAA,) West African countries will experience an increase in evapotranspiration (Smith, 2016). Essentially, the amount of water plants will be able to retain will decrease due to higher temperatures. This will have an impact on what areas will later be suitable to grow cacao. Figure 2 highlights the estimated change in temperature in Africa’s top cacao producing regions according to research done by Peter Läderach and his team.

Figure 2.

Temp change

Source: Atlas on Regional Integration in West Africa

With 70% of the world’s chocolate finding its origin in western African countries like Cote d’Ivoire, a decrease in production from West Africa would have a worldwide impact. (http://www.oecd.org/swac/publications/39596493.pdf) For several countries that fall within the West African cacao belt, Cacao is the number one agricultural export. Any decline could potentially result in major economic impacts for those countries (Läderach, Martinez-Valle, Schroth, & Castro, 2013; Schroth, Läderach, Martinez-Valle, Bunn, & Jassogne, 2016). It would also result in consequences for the natural habitats and cacao growing regions of these states. The research that has been done in Ghana and Cote d’Ivoire has indicated that by 2050, almost 90% of the current farmland would be unsuitable to grow cacao, with only a 10% increase in suitability. This is alarming as the vast majority of cacao production in Africa, and worldwide, stems from this region.

Figure 3

cacao production

Source: Lecture slides

Additionally, this new farmland comes at a cost. That is to say, in order to capitalize on other areas that will be suitable to grow cacao, countries facing this challenge will have to sacrifice environmental conservation (Läderach et al., 2013). This still would not make up for the amount of farmland lost to the temperature increases, while contributing to the factors that influence climate change.

While a decrease in African production would have global consequences, it is unlikely that climate change will eliminate chocolate and cacao production. As cacao grows around the globe, we can expect it will continue to be around. One of the concerns currently is that it is very likely that other regions around the world will have to pick up the slack. And that is a lot of slack! With the top cacao producing countries losing close to 90% of suitable cacao growing areas, it is unclear at this point where it is possible to make up for this loss. Without an answer in the next 20-30 years, chocolate will likely be much less of a household item than it was the last 100 years.

Let’s move to Mar’s…Inc.

According to the Candy Industry’s 2017 Global Top 100 list, Mar’s Inc. is the world’s top-grossing candy company. In 2017, their net sales topped $18 billion USD! (https://www.candyindustry.com/2017-Global-Top-100-Part-4) With earnings like that, it is not difficult to understand the level of investment and commitment the company would have to the preservation of chocolate production.

mars

Source: https://pxhere.com/en/photo/794479

Mars Inc. has put their money where their mouth is…or rather, where the chocolate is. They have invested in a project run by the Innovative Genomics Institute, in an effort to ensure future production of cacao. So far they have pledged $1 billion USD to creating sustainability and reducing their footprint, and this includes the CRISPR project. The goal of the project is not to specifically save cacao production, but rather to combat diseases in humans and plants (IGI 2018). Lucky for us, Theobroma Cacao is a plant. Winning! Well, maybe. The CRISPR technology is aimed at altering the genes of plants in order to make them resistant to disease. So this might not really help West African farmers who will lose cacao growing areas. By investing in this technology, Mars Inc. hopes to expand the possible areas cacao can be grown in.

As it stands today, different diseases and insects make in very difficult to grow and produce cacao. It is estimated that about 40% of the crops in the Americas are lost to fungal infections like witches’ broom (Shapiro & Shapiro, 2015). By increasing the natural resistance of the fruit-bearing trees, the average yield would increase 3 fold. This means that places that have been traditionally very difficult to produce cacao in could now become production centers. This would effectively reduce the impacts on chocolate manufacturers if the climate predictions do create impediments to cacao production in West Africa.

In a recent story done on the use of CRISPR technology, scientists working with IGI explained the advancements they have made in changing the genes of many crops that are prone to disease. They explain that they have already used the technology to create a solution for the swollen shoot virus that plagues cacao trees. (Schlender, 2018)

Source: https://www.voanews.com/embed/player/0/4332190.html?type=video

The technology works so quickly that IGI can have plants develop the desired traits within one generation! This is very good news for chocolate lovers. Assuming everything works out. The plants that have and will undergo this process will need to be researched extensively before they can be consumed by the public. This will ensure that people eating these modified crops do not grow an extra set of toes afterward.

This past year, Mars Inc. also made a significant investment in addressing climate change, planning to cut its own carbon emissions by two-thirds. A big part of this investment will be assisting farmers in improving their yields while simultaneously reducing pressures underlying deforestation. The idea is that the more a farmer can produce from their crops, the less land they will need to do it (Madson, 2017). This investment totals $1 billion USD and has been proposed to be completed by 2050.

Other chocolate giants such as Cadbury and Mondelez have also become a part of developing solutions for creating sustainability in cacao farming. Mondelez International’s non-profit arm, Cocoa Life, is focused on improving the lives of farmers in cacao-growing regions around the world. (https://www.cocoalife.org/the-program/approach) With increased commitment from large organizations with vast resources, it is possible to combat the potential effects of climate change.

What about the little guy/gal?

While it appears that Mars Inc. has likely stumbled upon a viable solution to their future issue of supply, what about the small-holders. The potential to move cacao production elsewhere is not great news for all parties involved. It is possible that genetic modification could potentially change under what conditions cacao trees thrive. However, it is unclear if this route could help the trees overcome evapotranspiration in the projected West African environments. It is very probable that this cash crop could find a new capital in other region or regions in other parts of the world. For the millions of farmers who are vulnerable to this threat, this is a challenge they will be forced to adapt to.

There are organizations such as the Rainforest Alliance who are working toward preparing farmers, equipping them with new strategies to protect their crops. The strategy being used is called Climate-Smart Agriculture, and in principal focuses on the specific needs of the specific farm (de Groot, 2017). Cacao farmers using this tactic would conduct a needs assessment of their farm, and create a plan that directly corresponds to the challenges that are unique to them. Some of the strategies include planting shade trees, as well as developing water retaining systems to prepare for droughts. While these will improve overall yield from these farms, it is unclear at this point how these tactics will far against climate change.

The tactic of planting shade trees is, however, a recommended strategy for those who fall in the Western African cacao belt. Currently, the farming trend has been to reduce the shade on cacao farms, however, this may no longer be an option. By increasing the shade of the cacao trees, the temperatures of its leaves could drop up to 4 °C (Läderach et al., 2013). Not only could this help protect cacao cultivation in Western Africa, it also helps to increase crop diversification. If done correctly, this would make cacao farmers less vulnerable to changing temperatures and less frequent rainfall. A downside to this recommendation is the limitation on the amount of water available during the dry season. The increase in plant life means less water to satisfy the needs of the cacao trees, and potentially losing the entire crop.

Conclusion

Chocolate is important. It directly impacts the lives of people around the world, in ways that transcend taste. For some, it is a highly desired treat, and for others, it is a means of opportunity. The effects of climate change have given all sides of the cacao industry a wake-up call to the importance of sustainable farming and improving our carbon footprint. Large organizations have begun to change the way they operate in the world, by reducing their emissions and helping to improve farming practices. Climate change could result in significant impacts on the cacao industry the world over. Reducing the amount of product available for purchase, and decreasing the available wages that can be earned in regions that are the most affected. Scientists, chocolate companies, and cacao farmers are starting to come together in an attempt to better the practices in this very important industry. Each has a role to play to play in this improvement, as well as the preparation for effects climate change will play in cacao and other vital crops.

 

Sources:

de Groot, H. (2017). Preparing Cocoa Farmers for Climate Change. Retrieved May 9, 2018, from https://www.rainforest-alliance.org/article/preparing-cocoa-farmers-for-climate-change

Läderach, P., Martinez-Valle, A., Schroth, G., & Castro, N. (2013). Predicting the future climatic suitability for cocoa farming of the world’s leading producer countries, Ghana and Côte d’Ivoire. Climatic Change, 119(3–4), 841–854. https://doi.org/10.1007/s10584-013-0774-8

Madson. (2017, October 27). Climate change could hurt chocolate production » Yale Climate Connections. Retrieved May 10, 2018, from https://www.yaleclimateconnections.org/2017/10/climate-change-could-hurt-chocolate-production/

Schlender, S. (2018). New Gene Editing Tool May Yield Bigger Harvests. Retrieved May 10, 2018, from https://www.voanews.com/a/crispr-for-bread-chocolate/4330647.html

Schroth, G., Läderach, P., Martinez-Valle, A. I., Bunn, C., & Jassogne, L. (2016). Vulnerability to climate change of cocoa in West Africa: Patterns, opportunities and limits to adaptation. Science of The Total Environment, 556, 231–241. https://doi.org/10.1016/j.scitotenv.2016.03.024

Shapiro, H. S., Howard-Yana, & Shapiro, H. S., Howard-Yana. (2015). The Race to Save Chocolate. https://doi.org/10.1038/scientificamericanfood0615-28

Smith, M. (2016). Climate & Chocolate | NOAA Climate.gov. Retrieved May 9, 2018, from https://www.climate.gov/news-features/climate-and/climate-chocolate

 

A Crafty Future

There is a revolution going on in America.  It exists as almost a counter to the industrial revolution that drove this country forward a hundred years before it.  Craft artisans are taking over in the wake of a society that has been built by mass production.  As this revolution moves across foodstuffs, it is of no surprise that craft chocolate is currently on the rise.  However, it is important to understand why this revolution is taking place now, and some of the hurdles it must overcome to continue its success.

The Lay of the Land

Currently two chocolate companies, Hershey’s and Mars, account for over 50% of chocolate sales in the U.S. (Euromonitor, 2017). It should be of no surprise that these two particular companies own so much of the market share. They were both founded on the idea of bringing chocolate, which was previously a luxury treat, to the masses.  Milton Hershey was a pioneer in mass production, revolutionizing and streamlining much of the industrial process.  Hershey’s team discovered that by using condensed sweetened skim milk they could create a product with longer shelf life and that blended easily with cocoa powder.  This meant that not only could he ship his chocolate bars further, but lasting longer on the shelf meant less profit losses due to spoilage.  Hershey also looked at supply chain optimizations, investing in his own dairy farms and even building a sugar mill operation in Cuba, complete with its own railroad.  This allowed Hershey to control both the costs of commodities for his chocolate bar and the quality.  Mars, on the other hand, was more successful due to marketing than anything else.  His Milky Way bar (which originally sourced chocolate from Hershey) was more nougat than chocolate, making it larger on shelf and seem a comparatively good value to the Hershey bar. That said, both had the same result, taking an indulgence that was once almost exclusive to the wealthy and middle classes and democratizing it for every day enjoyment.

chocolate sizingMass production allowed for chocolate to be produced cheaper, allowing those savings to be passed on to the consumer – or more importantly, from a marketing sense, for them to outprice their competitors.  But while price is important, so are the products themselves.  While it may have taken a while for consumers to acclimate to the flavor of Hershey’s and Mars bars when they first came on the market, the particular blend of milk, sugar and other ingredients insured that they were universally palatable and they now exist as the template for what we expect chocolate to taste like.  Similarly, both companies have hero products that are specifically designed for easy consumption.  Both Hershey’s Kisses and M&Ms were made for portability (individually wrapped/ melts in your mouth, not in your hand) and their small, poppable size makes it easy for consumers to lose track of mindfulness and eat large quantities in one sitting. These products have other advantages, as they are easily adaptable to innovation.  As consumers are desiring more variety and novelty across the board, these products have proven to be the most flexible in introducing new flavors – and easily acceptable to consumers who are familiar with their form and have built brand trust.  These companies have leveraged seasonality, larger cultural trends, and limited time offers to drive new product news and sales.

pumpkin(wait.  Is she wearing an infinity scarf and hipster glasses?)

So, if big chocolate is designed for palatability and companies are responding to consumers desires for more interesting, topical flavors, why are we seeing a proliferation of craft chocolate providers? When we look at the numbers, the story becomes more telling.   When looking at sales growth, mass chocolate has remained flat year over year (CSP daily news, 2016).  This despite their innovation and the fact that chocolate consumption overall is growing.  Instead, the growth seems to be predominantly driven by premium and craft chocolates, suggesting not just changing tastes, but a changing attitude about where our food is actually coming from.

Big Food Backlash

There is growing negativity towards giant corporations and conglomerates, particularly when it comes to food. From an economic standpoint, consumers have watched as these corporations get massive tax breaks which have translated into bonuses for the executive suite, while the working class continues to struggle.  While this issue impacts most major corporations, it is of particular concern when it comes to the chocolate industry and growing awareness around fair labor practices, forced labor, child labor and the ethical price people pay for their chocolate.  There is a lot of skepticism that these companies will make ethical choices when given the opportunity, particularly when people see so many examples in the news of them pursuing profits over people, such as Nestle bottling drinkable water in the middle of the Flint, Michigan water crisis (the guardian, 2017).  More and more often, buying in to big brands feels like an investment against your own interests.

The Big Middle creates more space for differentiation

The sheer nature of big brands as they fold in to one another may be working against them. “When you have increasing concentration of producers in the center, you leave room on the periphery for specialization,” says Elizabeth G. Pontikes, associate professor at the University of Chicago’s Booth School of Business. (Shanker, 2017) In other words, these multinational conglomerates are creating their own sea of sameness.  In a society that is increasingly valuing individuality, particularly when it comes to the millennial and younger generations, brands and products that lack differentiation also lack appeal.  We can see this even in the most famous of branding cases, Coke vs. Pepsi with beverage drinkers now migrating to new choices like LaCroix and energy drinks.

The obvious choice might be for these mass chocolate brands to create verticals that touch these periphery spaces, but they have struggled breaking in.  Hershey’s introduced their Cacao Reserve premium line in 2006.  The brand lasted three years, suffered several price drops and the need for mass market advertising support, before they dropped it from store shelves. (Thompson, 2007) Their next move was to build their premium line using borrowed equity.  At the same time they launched Cacao Reserve, they purchased Scharfeen Berger, a premium line of chocolates out of California. As they pushed to mass market the brand, they switched suppliers, using cheaper beans from West Africa.  The result was severed relationships with brands like Whole Foods, who were concerned that Hershey’s could not guarantee that the beans weren’t sourced through child labor (Bloomberg, 2017).  The brand has somewhat rebounded, but the initial loss is still being recovered, and leaves the question as to whether or not big brands can ever play credibly in the premium/ craft space.

A wake up call for food

The obesity crisis in America was a wake up call about the food we consume and how it is being produced.  A series of films, articles and exposes, while at times misleading and ignores the true labor of food, caused people to rethink what they are getting out of processed food.  The consumer take-away was that mass produced food lacks quality and nutritional value, is predominantly artificial fillers, and is potentially detrimental to your overall health. Quality, whole ingredients, and care has become increasingly synonymous with healthfulness, regardless of traditional markers like fat and calories.

While all of these things make craft chocolate more appealing, it still has hurdles to overcome to convince people to pay the enormous price tag that comes along with it.

As noted, industrial chocolate is the baseline for people’s orientation to what chocolate should look and taste like, as well as what it should cost.  For Craft chocolate to succeed, they don’t just need to overcome the shift to premium pricing, they need to overcome expectations set by mass market chocolate.  There is a need to educate people on to the true value of the chocolate they are consuming and the difference that craft chocolate provides. There are four key ways in which craft offers a point of difference that both provides a difference that supports craft’s value proposition and requires consumer education: process, taste, ingredients and sourcing and ethics.

Understanding the process

Over time, manufactures have swapped out real ingredients for cheaper artificial substitutes such as vanillin instead of vanilla.  (Martin-Sampeck, 2016). This has impact on the flavor, consistency and mouthfeel of the chocolate itself. Craft chocolate’s smaller production model in of itself creates a different end product, but some companies have gone further, focusing on minimizing the process.

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Taza chocolate, a bean to bar company located in Somerville, MA, takes great pains to educate consumers as to their process.  They describe their bars as “chocolate with true grit.” Their mission is to return chocolate to its pre-industrial roots.  They believe that less processing allows for more complexity in flavors. Their chocolate is stone ground on hand carved molinos (mill stones) with little refinement between that and the end product.  The result is, to their description, a chocolate bar that lacks the smoothness that consumers have come to expect, but with a stronger chocolate flavor and more complexity in experience overall.

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Expanding your palate

“When most people eat a piece of chocolate we want that pleasure immediately: boom!  That’s the music of mass-market chocolate.” (Williams, 2012)

Historians have theorized (incorrectly) that when chocolate came to the old world, that it was appropriated to suit Europeans’ tastes (Norton, 2016).  In fact, chocolate’s evolution from its new world form to the substance we know today was a process that took over a century of innovation.  The chocolate that Europeans first enjoyed was a fairly close recreation of how it was consumed in Mesoamerica.  The Europeans had just acquired a taste for it.  That said, they had a lot of motivation to do so – chocolate was seen as exotic, a luxury (due to both its scarcity and use as currency), and had potential new health benefits.  Additionally, unlike today, there was no basis for comparison.  For today’s consumers, their palates have been educated in the world of mass produced chocolate – and what they have come to expect is a very sweet, creamy, almost single note experience.  Craft chocolate, on the other hand, leans in to chocolate’s bitter notes, and offers way more complexity.  Not only do consumers need to adjust to the new flavor profile, but they need help recognizing the flavor notes to truly appreciate the difference they are getting from craft.

Dick Taylor chocolates started in a small factory in Eureka, California by Adam Dick and Dustin Taylor.  They started their factory out of a love of craftsmanship and making things with their hands (both worked in woodworking and boat building).  In addition to educating consumers on the sourcing of their beans, they seek to educate consumers on how craft processing changes the flavor and experience of their chocolate.  From their website “by not cutting corners or taking shortcuts in our process we are able to leave out vanilla, additional cocoa butter or other emulsifiers, in hopes of capturing and highlighting the subtle flavor nuances in the cacao we source from around the world.”

In this they set expectations that their chocolate will be less sweet and have more complexity of flavors.  To further support that, their packaging calls out the specific flavor notes that the chocolate bar offers, much in the way that wine and craft beers call out tasting notes.

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XOCOLATL, a “micro-factory” chocolatier out of Atlanta similarly looks to highlight chocolate’s natural flavors.  Their bars are blended with spices and other elements that call out chocolate’s flavor components.  For example, their Americana bar contains no apples, but uses familiar pie spices to highlight that quality within the chocolate.

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Origin/ localization

While mass chocolate uses the blending of not only several different types of beans, but beans from multiple locations, there is a rising trend in single origin chocolate.  This has arisen both out of an increased interest in food provenance and small chocolate purveyors interest in highlighting the different unique flavor profiles of the beans.  (Norton, 2013) By doing so, they are able to not only show off the different flavor varietals, but capitalize on the exotic locales to add a sense of rarity and uniqueness to their product lines.

Amedei Chocolates, a craft company out of Tuscany, Italy, builds their sourcing education in to their product offerings.  Each of their bar product lines serves as an exploration in the difference that cacao content, origin and the beans themselves can make.  Their Toscano Black line offers three different (though relatively close) percentages of dark chocolate – 63%, 66%, and 70%.  Their cru product line is all single origin dark chocolate – allowing consumers to taste the subtle differences between each region.  But where they go one step further than many bars is to focus and educate consumers on the strains of cacao available.  They offer both a Blanco de Criollo and a Porcelana bar.  The external packaging on each features a botanical drawing of the bean.  The inside explains the history, origin and flavor notes.  For the Porcelana bar, it notes the Venuzuela plantation, it’s small production of only 3,000 kilos of beans, and the rarity of this particular strain. Tasting notes are described as “toasted almonds that alternates with pressed olives.” This reinforces the specialness of the bar and the unique experience that it offers, while simultaneously pushing the consumer’s palate to recognize more subtleties in flavor.

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Ethical Sourcing

One of the major challenges in the chocolate industry overall is the issue of labor practices and sourcing.  Even setting aside the more dire problems of forced and child labor, very little of the profits made from chocolate sales actually makes its way back to the farmers that grow it.  While there are a variety of certification schemes (i.e. Fair Trade, UTZ Certified, IMO Fair for Life), the cost of participating is high, and consumer demand has yet to drive a higher price in goods that can be translated back to the farmer. (Martin-Sampeck, 2016)  Additionally, there are those who don’t think that programs like Fair Trade go far enough, and result in a minimal profit increase for the farmer.

Companies like Taza and Askinosie chocolates instead have focused on direct trade, which cuts out middlemen and insures that more profits go back to the hands of the farmers.  Askinosie notes on their website “we hold the craft and quality of our chocolate in almost equal balance with doing as much good as we can in the world.”  As part of educating consumers at to the importance of direct trade, their bars feature the actual farmers that they work with on the front.  The back label tells that person’s story, how they became acquainted with Askinosie chocolate, and how their contribution insured the quality of the product you are holding.  It also features the following guarantee:  A stake in the Outcome. We guarantee to our farmers more than fair prices, open books and a share in our success.   In the way that they tell the story of their trade relationships, Askinosie doesn’t just insure the consumer of the ethics of their bar, they humanize it and translate that in to a real value to the consumer in the quality and craft of the final product itself.

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The future of craft

Craft still has some educational and orientation challenges to overcome, but as more and more people migrate away from big food and big chocolate, the opportunity to create a wider variety of chocolates leveraging ethical sourcing and quality ingredients remains as promising and sweet as the product itself.

Sources used:

Brenner, Joel. 2000. The Emperors of Chocolate: Inside the Secret World of Hershey and Mars.

Coe, Sophie D., and Michael D. Coe. 2007 (1996) The True History of Chocolate.

CPS News (September 15, 2016) Premium Chocolate Driving US Sales Growth.  CPS Daily News. Retrieved from:http://www.cspdailynews.com/category-news/snacks-candy/articles/premium-chocolate-driving-us-sales-growth

D’Antonio, Michael D. 2006. Milton S. Hershey’s Extraordinary Life of Wealth, Empire, and Utopian Dreams.

Glenza, Jessica. (September 29, 2017) Nestle Pays $200 a Year to Bottle Water Near Flint Michigan.  The Guardian. Retrieved from https://www.theguardian.com/us-news/2017/sep/29/nestle-pays-200-a-year-to-bottle-water-near-flint-where-water-is-undrinkable

Laudan, Rachel (May 5, 2015) A Plea for Culinary Modernism. Jacobin Magazine Retrieved from https://www.jacobinmag.com/2015/05/slow-food-artisanal-natural-preservatives/

Leissle, Kristy. (2013) Invisible West Africa: the Politics of Single Origin Chocolate. Gastronmics: The Journal of Food and Culture, Vol. 13. No. 3 (Fall 2013)pp.22-31

Martin, Carla and Sampeck, Kathryn. 2016. “The Bitter and Sweet of Chocolate in Europe.” pp. 37-60.

Norton, Marcy. 2006. “Tasting Empire: Chocolate and the European Internalization of Mesoamerican Aesthetics.”The American Historical Review 111 (3): 660-691

Shanker, Deena (February 7, 2017) The Rise of Craft Chocolate. Bloomberg News. Retrieved from https://www.bloomberg.com/news/features/2017-02-07/the-rise-of-craft-chocolate

Terrio, Susan J. 2000. Crafting the Culture and History of French Chocolate. pp. 1-65

Thompson, Stephanie. (March 6, 2007) Reservations about Reserve Haunt Hershey. Adage Magazine. Retrieved from: http://adage.com/article/news/reservations-reserve-haunt-hershey/115326/

Trout, Jack. Differientate or Die: Survival in our Era of Killer Competition. New York. Wiley, Second Edition 2008

Williams, Pam and Jim Beer. 2012. Raising the Bar: The Future of Fine Chocolate. pp.141-209

Yu, Douglas. (March 29, 2018) Lindt Will Most Certainly Come Back to Growth in US. Confectionary News. Retrieved from https://www.confectionerynews.com/Article/2018/03/29/Lindt-will-most-certainly-come-back-to-growth-in-US-says-Vontobel

 

Chocolate Production in the GCC

Even though the Middle East is not thought of as a significant chocolate producer, in recent years there has been an increase in production.  From international companies setting up factories in the region, to the emergence of local small-scale organizations, there is an awareness of  an expanding market and demand for standard and luxury chocolate.  However, there is a lack in transparency, awareness of the supply chain, and even sourcing of the cocoa beans.  This is changing slowly in recent years with the emergence of local bean-to-bar companies that realize that there is a gap in this regional market.

The Market:  

The increase in volume of chocolate confectionary retail in the Middle East and Africa is said to be the largest world-wide, where volume has more than doubled since 2000 (+104 per cent). (Poelmans, 34) This is in part due to strong economic growth, rising incomes, and a youthful population. (37) The Arab region and Gulf, known as the GCC (Qatar, Kuwait, UAE, Saudi Arabia, and Bahrain), in particular is known for its passion for sugary goods, with the value of this sector amounting to $10 billion, with growth of 12% annually, which is the highest in the world.  The size of the chocolate market in the region is increasing continuously, where Saudi Arabia imported 250 tons of Swiss chocolate in 2014, an increase of 8.2% from the year before.  The consumption of standard and luxury chocolate increases during “Eid” festivities especially, to exceed 14 million dollars. (“UAE and Saudi Arabia top Middle East chocolate importers”)

Image result for ctc festival chocolate

Image: Kids Chocolate Activities at CTC Festival in Qatar.

Chocolate and Socialization:

In the region, chocolate bars represent a socialization with family and friends and are favored by locals and expatriates. (El-Khazindar, 51) Many occasions have incorporated chocolate as a necessary factor, these include the Holy month of Ramadan, Eid, weddings, births, social gatherings; as the chocolate presence increases with local and international chocolate brands appearing in malls and streets all over the region in the last few decades.   In recent years, specialized chocolate festivals have taken place in several places, such as the Coffee & Chocolate International Exhibition in Riyadh, the Chocolate, Tea, and Coffee Festival in Qatar, and a Chocolate Bazaar in Dubai with a chocolate fountain and chocolate egg hunt. (Ravindranathan)

International Brands:

The Gulf region has seen a growing chocolate production in recent decades, where the international giants have engulfed the market.  For example, Mars GCC, is the undisputed leader in chocolate confectionary with a value share of 42% in 2012 in the region.  It is supported by brands such as Galaxy, Snickers, Twix, Mars, and M&M’s.  The second position was occupied by Nestle Middle East, with a retail value share of 17% as of 2012, supported by the strong position of the KitKat brand. (Sambridge, “Mars GCC opens $40 m chocolate factory in Dubai”) The first Mars GCC factory was opened in 1998 in Dubai to produce the complete range of Galaxy chocolates locally.  In 2010, a new $40 million 6,000 sq. m chocolate factory was opened. The company posted net sales of more than $450m, and claims double digit growth every year since the beginning of the decade, and with consumer demand they have a strong commitment and target for further growth.  They aim to strengthen their position as the leading chocolate manufacturer in the Middle East, and will continue to distribute products to more than 20 countries in the GCC, Africa, Asia, Europe, and the Middle East, spreading from the UK to Taiwan. (Sambridge, “Mars Inc invests further $60m to expand Dubai factory”)

Middle East Map highlighting GCC member countries

Furthermore, in 2014, Mars GCC invested a further $60m to expand the Dubai factory, adding new production lines for its Snickers chocolate bars, making the total investment over $160 million.  Chocolate sales in the Middle East and North Africa were expected to reach $5.8 billion in 2016. The company opened another factory in the region, with a $210m investment, the US confectionary giant built a state-of-the-art $60 million manufacturing facility at King Abdulla Economic City, to create the popular Galaxy and Galaxy Jewels chocolate bars. (McGinley) However, Mars GCC omits important information regarding cacao sourcing, fair trade techniques and overall transparency as the case in most Mars branches.

Furthermore, companies outside of the Gulf cater to this market, such as Lebanese companies Patchi or Crystal.  They also display a lack of attention to sourcing and information on the supply chain, despite the grand scale of their production.  Patchi was founded in Beirut in 1974 and currently has factories in five Middle Eastern countries, among them the UAE and Saudi Arabia.  As of 2011, the company has annual chocolate sales in the region exceeding US $4.2 billion and is expanding to international markets. (“For the Love of Chocolate”)

Local Companies:

When it comes to local chocolate companies in the region, there is a lack of transparency and more of a focus on the luxury side, emphasizing chocolate from Belgium, Switzerland, and France.  Terroir is not a factor in this market. The connection that is most emphasized is the European production, as stated in most company profiles.  There is a general misconception that chocolate imported from these countries, no matter the source of the beans, are automatically of better quality than chocolate produced locally.  (“Ali Al-Kazemi..”)  This is the case with the chocolate producer, AlKazemi in Kuwait.  With the factory now supplying 60%-70% to coffee shops or companies in Kuwait, and the rest to other Gulf countries. New chocolates are produced daily to suit new tastes, and the company produced its packaging in house as well.  (“A Tour of Alkazemi…”) By producing high quality chocolate in the region, they are trying to challenge these misconceptions.

Image: Alkazemi Chocolate Factory – Kuwait

I spoke to one of the owners of the chocolate company in Kuwait named Silverenia.  It is known in the region for its unique shaped chocolates, local ingredients, as well as seasonal flavorings, such as cotton candy.  It’s biggest markets are within Kuwait, Qatar, and Saudi Arabia; with the most in demand occasions being weddings and newborn celebrations.  The owner stated that their chocolate is imported from Belgium, Switzerland, and France; thus, he was not sure of the source of the beans, and stated it may have been African. The company uses couverture tempering method to shape their chocolate into elaborate shapes, where the designs are made in house and are updated every year.

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Image: Silverenia Chocolate

In addition, this is the case in Dubai, where there are an overall eighteen chocolate factories in the city, several that import from Belgium, France or Switzerland and place their own brand on the product. (El-Khazindar, 46) The domestic market was valued at $222bn in the last few years. (Duncan) One of these chocolate companies, called ChoCo’a has expanded its market beyond the region and has its products reach Russia, Japan, Australia, and Morocco; through participating in prestigious global exhibitions and fairs. (El-Khazindar, 53)

More regional companies emphasise the European connections of their chocolates. In Qatar, the chocolate producer Kaafe, established in 2011, sells “premium hand-made Belgian chocolates” with an “Arabic taste”.  It also does not name the source of its cocoa beans, but emphasizes that it boycotts companies that rely on child labor and slavery farmers. (Qatar Tribune) Another chocolate company in Bahrain, Chocolate & Co, focuses on premium chocolate, combining skillful artisans with a state-of-the art manufacturing process, to make products out of “fine Belgian chocolate” and quality ingredients from around the world. (“Our Story”) Also, most of the other chocolate producers in the region, such as a number in Saudi Arabia, focus on their story, their market, and means of production; but do not address any sourcing or ethical concerns. (Saudi Chocolate Factory, Badr Chocolate Factory, Bostani).

Emphasis on Luxury:

The luxury chocolate market has been expanding over recent decades in the region.  Studying the psychology of consumer behavior, reveals three distinct types of buyers, the convenience, value, and luxury buyer, all with different behaviors and demands.  The luxury buyer has been increasing in developing and developed economies with the idea that expensive chocolate is an affordable luxury. (El-Khazindar, 79) Dubai announced the launch of the Middle East’s most expensive chocolate. The French company Debauve & Gallais’s box is the sixth most expensive chocolate in the world (Bhoyrul).  Even brands such as Godiva and Lindt are becoming almost mass market, as consumers develop a taste for everyday glamour. In the last decade, there has been a strong segment of the market that seeks these luxury chocolates. (El-Khazindar, 46) The emphasis on luxury, local spices and ingredients on the company profiles seems to be the main information presented for these chocolate companies in the region.

Changing Awareness:

However, the awareness of the importance of sourcing of the cocoa beans, transparency, and fair trade in the whole supply chain is slowly emerging in the region.  In recent years, a bean-to-bar company has emerged in Dubai, called ‘Mirzam’.  It emphasizes sourcing single origin beans from Vietnam, Indonesia, Madagascar, Papua New Guinea and India. Mirzam uses the legacy of the region as a trade bridge between East and West in its marketing. They designed the production process to be transparent and have catered to a huge demand a gap in the market for handcrafted ‘real’ chocolate, and aim to expand across the region.  Also, in Qatar, a new chocolate company called Buono emphasizes its single origin Ecuadorian cacao beans of the purest kind for its chocolate. (Buono Website)

What is the significance of this region in needing to address ethical factors in its chocolate production and supply chain? As we have seen the region is growing in chocolate production, locally and internationally.  Big name companies are investing in factories to cater to the region, while small companies are being established as well.  The companies in the region need to factor in organic, fair trade, and direct trade for their many benefits (when established correctly).  Fair trade improves lives and protects the environment, as well ensures quality products.  It helps farmers in developing countries build sustainable businesses that positively influence their communities. By establishing Fair Trade in the region, there can be a long term direct trading, ensuring prompt payment of fair prices and wages, no child, forced, or exploited labor, safe working environments.  Also, an emphasis on the importance in traceability and transparency.  Direct trade can lead to the companies in the region to remove the middle man of Europe and to promote direct communication and price negotiation between buyer and farmer, along with systems that encourage and incentivize quality.  It is also important as it challenges the geographical indexing of our world of the global south vs. global north in the context of the chocolate industry.  The fact that the Middle East is in the middle of these two regions, it could positively affect the global south in its reforms, and eradicate many problems that face under appreciated chocolate farmers. (Alternative Trade Lecture Slides).

Image: 1,000kg Chocolate Cake on Display for Ramadan in Dubai.

Conclusion:

The GCC’s has had a growing importance in chocolate production and as a consumer market in recent times.  With many companies within the region and outside of the region catering to its growing standard and luxury consumer market. However, the ethical concerns, emphasis on organic, fair trade, and terroir does not receive adequate attention in the region.  The main indicator of quality to these companies is the manufacturing, and importing of chocolate from Belgian, Swiss, or French sources as an indicator of luxury, despite where the beans come from.  There is an awareness that is slowly emerging and should increase once consumers are completely aware of the differences, the ethical issues that plague the cacao industry, and demand that the companies contribute more positively to farmers, in eradicating poverty, child abuse, and other labor issues.

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Media Sources:

  1. Kids Chocolate Activities at the CTC Festival in Qatar.  http://ctcfestival.qa/activities.php
  2. Map of the GCC. https://www.mapsofworld.com/answers/politics/is-qatar-part-of-gcc/attachment/map-of-gcc-countries/
  3. Alkazemi Chocolate Factory in Kuwait.  https://khaleejesque.com/2012/05/blog/a-tour-of-al-kazemi-food-industries-kuwaits-own-chocolate-factory/
  4. Silverenia Chocolate. https://www.instagram.com/silverenia/
  5. “1,000kg chocolate cake on display in Dubai for Ramadan.”  06 July 2016.  http://www.arabianbusiness.com/1-000kg-chocolate-cake-on-display-in-dubai-for-ramadan-598710.html

 

Works Cited:

Poelmans, Eline and Johan Swinnen. “A Brief Economic History of Chocolate”.  The Economics of Chocolate. Ed. Mara P. Squicciarini and Johan Swinnen. 2016: Oxford University Press.

“UAE and Saudi Arabia top Middle East chocolate importers.” 24 November 2015. Saudi Gazette.  https://english.alarabiya.net/en/business/markets/2015/11/24/UAE-and-Saudi-Arabia-top-Middle-East-chocolate-importers.html

El-Khazindar Business Research and Case Center. Entrepreneurship in the Arab world. 2016: The American University in Cairo Press.

Interview with the manager of Silverenia conducted over the phone on May 2, 2018.

Ravindranathan, Shreeja. “There’s a chocolate festival at Dubai Marina mall”.    20 April 2017.  https://fridaymagazine.ae/life-culture/there-s-a-chocolate-festival-at-dubai-marina-mall-1.2014837

Sambridge, Andy. “Mars GCC opens $40m chocolate factory in Dubai”. Arabian Business. 27 May 2010. http://www.arabianbusiness.com/mars-gcc-opens-40m-chocolate-factory-in-dubai-271385.html

Sambridge, Andy. “Mars Inc invests further $60m to expand Dubai factory”. Arabian Business. 12 December 2014.  http://www.arabianbusiness.com/mars-inc-invests-further-60m-expand-dubai-factory-574804.html

McGinley, Shane. “Mars to open chocolate bar factory in Saudi Arabia”.  Arabian Business.  16 February 2012.  http://www.arabianbusiness.com/mars-open-chocolate-bar-factory-in-saudi-arabia-445654.html

“Ali Al-Kazemi: Leading The Region’s Top Chocolate Factory”. 2 April 2012.  https://khaleejesque.com/2012/04/diwan/ali-al-kazemi-leading-the-regions-top-chocolate-factory/

“A Tour of AlKazemi Food Industries, Kuwait’s Own Chocolate Factory”.   3 May 2012.  https://khaleejesque.com/2012/05/blog/a-tour-of-al-kazemi-food-industries-kuwaits-own-chocolate-factory/

Duncan, Gillian. “Sweet times for Dubai chocolatier ChoCo’a”. The National. 28 March 2012. https://www.thenational.ae/business/sweet-times-for-dubai-chocolatier-choco-a-1.383043?videoId=5585868180001

“Kaafe Chocolatier Opens Showroom”. Qatar Tribune. http://archive.qatar-tribune.com/viewnews.aspx?n=7C14A632-11AE-4E39-83E8-230C1136939A&d=20150313

Chocolate & co. “The Story”. http://www.choc-and-co.com/thestory

“For the Love of Chocolate”. 30 August 2011. http://www.wipo.int/ipadvantage/en/details.jsp?id=2848

Bhoyrul, Anil. “Dubai Launches Middle East’s most expensive Chocolate”.  Arabian Business.  23 Feb 2012.  http://www.arabianbusiness.com/dubai-launches-middle-east-s-most-expensive-chocolate-446636.html

Mirzam, Chocolate Makers. https://mirzam.com/us/

Woods, Andrew. “Mirzam to Sell its Chocolate across the GCC”.  Business Chief.  26 January 2018. https://middleeast.businesschief.com/leadership/1409/Mirzam-to-sell-its-chocolate-across-the-GCC

Professor Carla D. Martin.  Lecture Slides: “Alternative trade and virtuous localization/globalization”. Harvard University.  04 April 2018.

 

How Large Chocolate Companies and Smaller Chocolatiers Differentiate Themselves in Advertisements

The chocolate industry is evolving. Though major companies like Hershey and Mars have dominated it for its entire existence, new artisan or boutique chocolatiers are appearing, ready to challenge them for supremacy. The idea of small, local competition is nothing new for the behemoths, who had to combat independent grocers earlier in the 20th century. These new companies are more legitimate than an independent grocer, though. Some, like Taza, experience enough success that they grow into fairly large companies, and others, though they may remain small, still carry a distinct air of legitimacy.

These two sectors are quite different in scale, so how do they differentiate themselves in terms of how they advertise themselves to customers? Historian Emma Robertson notes that, “chocolate has long-standing associations with female sexuality” and discusses how this manifests itself in chocolate marketing in her book, Chocolate Women and Empire: A Social and Cultural History (Robertson, 1-3). Though these sexualized undertones are strong throughout the chocolate industry and sometimes become painfully explicit in advertising, I will not focus on them here. Instead, I will be concerned with how the two sectors of companies differentiate themselves from each other in how they discuss and market their products. My two main examples will be Jacques Torres Chocolate and two subsidiaries of Mars, Dove and Galaxy. On the whole, the Jacques Torres material focuses on the quality of the product and the personality of Torres, while the Mars subsidiaries focus on chocolate’s larger connotations and its idealized worlds, which represents an evolution in the larger cultural discussion about chocolate in advertisements.

Historically, these two subsets of the chocolate industry have had to jointly combat the stigma of adulteration. Chocolate contains a multitude of ingredients, which, dating back to Cadbury in 1869, have a long history of being adulterated to cut costs. In her article “Blame Candy” in The Chronicle of Higher Education, Samira Kawash reports that, “candy makers were suspected of cutting corners… [and] boosting the bottom line by adding fillers like plaster or sawdust…, replacing chocolate with wax or nuts with cardboard, employing toxic dyes to create eye-catching colors” (Kawash). Though large companies like Cadbury were often implicated, this stigma was attached to all chocolate, including chocolate made by independent producers. One newspaper ad from the early 1900’s produced by Mars was entitled “You’ll Never Sell Her Cheap Candy Again” and introduced a short vignette with parents blaming their daughter’s stomach ache on cheap candy purchased at the local corner store, as opposed to the fine Mars products that “give you more quality” (Proquest Database). The branding war between large companies and small, independent producers, then, is nothing new.

Not only did small grocers and large companies compete over who would be stuck with chocolate’s negative associations, they also have differentiated themselves in their advertising for as long as chocolate has been mass produced. In their book Chocolate: History, Culture and Heritage, Louis Evan Grivetti and Howard-Yana Shapiro note that in the late 1800’s, chocolate “manufacturers would supply retail merchants with large chromos [small cards with designs and advertisements on them] to stimulate sales.” While, “Victorian sentimentality prevailed” with larger chocolate companies’ ornate designs, the authors note that, “cards for grocers were much more business-like,” and often just listed prices or products (Grivetti & Shapiro, 185-7). This difference in marketing was probably merely one of necessity, as the smaller grocers could not afford the ornate designs of the larger companies. The underlying trend, however, of smaller chocolatiers focusing on their product exclusively and bigger companies worrying more about its connotations and ancillary benefits, persists to this day.

In 2016, the two groups wage a similar war, one that is played out online and on television as opposed to in newspapers. On Jacques Torres’s website, the company asserts itself as a provider of high quality, artisan, hand-crafted chocolate. The most subtle way it does this is through its name. Jacques Torres, nicknamed “Mr. Chocolate” is a relatively famous personality, but Torres’ name gives the company clout even independent of his reputation. The fact that the company is named after a specific person makes the customer feel as though they are personally interacting with Torres every time they engage with his company. It adds a level of personality and specificity that a big company cannot match. The “About Us” section goes on to detail Torres’s many accomplishments in his culinary career, granting him an air of absolute legitimacy. Nothing Mars puts out can compete with something personally crafted by an award-winning French chef. The section goes on to write that, “Jacques Torres Chocolate is proud to produce real food bursting with real flavor made without taking any shortcuts or adding any preservatives, extracts or ‘essences.'” Here, the company is appealing to the fraught history of chocolate, and assuring potential customers that they have no part of that. Jacques, it seems, is above such tricks.

Screen Shot 2016-05-04 at 10.44.29 PMhttp://www.mrchocolate.com/experience/

Other parts of the website underscore this point. In the picture above, Torres appears to be in touch with nature, and therefore healthy. The About Us section does claim, after all, that Torres’ chocolate is “better for you”. Though it does not elaborate on exactly what the chocolate is better than, any discerning chocolate customer may easily guess. The section closes with the words, “Real. Authentic. Original.” All of these words are variations on the same idea, which is that Jacques Torres chocolate creates a personal connection with the customer, and leverages that connection to gain legitimacy.

The video appearing prominently on the site achieves a similar effect.

This video is something called “A Taste of The Terminal”, and was produced by Grand Central Terminal. In its decision to include it in their website’s promotional material, though, the company elaborates upon the personableness and legitimacy that it has built in its “About Us” section. First, Jacques seems eminently likable. He is very nice to all whom he interacts with, posing for pictures and doing fist bumps with random strangers. The viewer wishes that he or she could have been in the station when he was handing out his crepe samples. Perhaps oddly, though, the video does not discuss chocolate much. The main focus, one could argue, is crepes. Here again, though, the company has shrewdly positioned Jacques as a culinary authority, a master of all. In establishing his ability as a maker of crepes, the video has established his ability as a chef overall, which makes him seem even more legitimate to a customer. Through all of his company’s promotional materials, Jacques Torres appears as a world-renowned pastry chef, who has come to personally cater to his customers’ needs.

Mars company, on the other hand, cannot quite compete with Jacques on a personal level. What it can do, is emphasize certain connotations about its products and those that eat them.

According to an article in the advertising journal The Spot, this advertisement was meant to “give the brand a fresh look, and spur more everyday purchases by customers” (Nudd, The Spot). The advertisement accomplishes this goal by using actors that appear more normal and even quirky. These are not the “classically” beautiful models from stereotypical perfume or chocolate commercials. The decision to film the advertisement as a stop-motion movie increases the quirkiness of the environment, and makes the magical enhancement of the environment by the characters seem more normal. The advertisement ties in these environmental expansions by telling the viewers, “It’s always better when there’s a little more to love”, connecting the bigger bar with the bigger landscape features. This advertisement is working on a much more implicit scale than the Jacques Torres promotional material, though. Whereas Torres touts the craftsmanship of the product and the legitimacy of the chef, Dove focuses on an idealized vision of the world in which its chocolate exists. If you want to live in that world, then you want to eat Dove chocolate.

The vision of an idealized world shines through even more clearly in this Galaxy advertisement, which Dove also used a shortened version of in America. The actress depicted is Audrey Hepburn, who has been CGI’ed into the scene. This detail already sets up the world as a sort of idealized fantasy-land, as Hepburn, long dead, could not possibly appear in a new advertisement–and yet, there she is. Inspired by her Galaxy bar, Hepburn leaves her bus and gets into the back of a man’s car and speeds away from a generic quaint European town into a generic quaint European countryside. The slow fade-in of the song, which is “Moon River”, a song from one of Hepburn’s most famous films, Breakfast at Tiffany’s, increases the sentimentality, as non-diagetic sound gradually overpowers diagetic sound. In this fantasy-land, Galaxy chocolate reins supreme. It has driven Hepburn to act boldly and run away with the man of her dreams (we may assume). People who would like a window into such a world or perhaps to be like Hepburn must eat Galaxy chocolate in order to attain such dreams.

The central difference between the Dove and Galaxy advertisements and the promotional material for Jacques Torres is that the Jacques Torres material focuses on the quality of the product and the Mars subsidiaries focus on its connotations. It seems that now, with chocolate under fire as an unhealthy food, the smaller artisans are attacking that stigma head on, while the larger companies are skirting it entirely and trying to reframe the conversation around not what chocolate contains, but, rather, what it means. Mars’ side-stepping of the debate positions it not so much as a food company, but as a lifestyle company. If you want to eat well, eat Jacques Torres. If you want to live well, eat Dove and Galaxy.

 

Works Cited:

Scholarly Sources:

Kawash, Samira. “Blame Candy.” The Chronicle of Higher Education 60.08 (2013). Biography in Context. Web. 12 Mar. 2016.

Robertson, Emma. 2010. Chocolate, Women and Empire: A Social and Cultural History

Grivetti, Louis, and Howard-Yana Shapiro. Chocolate: History, Culture, and Heritage. Hoboken, NJ: Wiley, 2009. Print.
Nudd, T. (2012, Apr). The spot: Heaven on earth. Adweek, 53, 11. Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/1008667105?accountid=11311.

Multimedia Sources:

“A Taste of the Terminal: Jacques Torres” from Youtube

“Dove Chocolate Bar Ad_ More To Love” from Youtube

“Audrey Hepburn: Galaxy Chocolate Commercial” from Youtube

“Mr. Chocolate: Experiences” http://www.mrchocolate.com/experience/

“Mr. Chocolate: About Us” http://www.mrchocolate.com/about-us/

“Display Ad 62–No Title”. New York Herald Tribune (1926-1962); Oct 20, 1933; Proquest Historical Newspapers: New York Tribune/Herald Tribune

THE FUTURE OF CHOCOLATE: HOW CLIMATE CHANGE WILL AFFECT CACAO FARMERS IN WESTERN AFRICA

The Chocolate, Culture, and the Politics of Food course ended with a very interesting question: What is the future of chocolate? We would like to think that chocolate has a future, especially in the it-should-always-be-available-for-my-consumption sense, but if you have ever really wondered about the future of chocolate, this report might shed some light on the long-term sustainability of cacao and the livelihood of farmers who do their best to meet the growing demand in the age of global warming and projected climate change.

Note: Cacao and cocoa will be used interchangeably for the purposes of this report.

Introduction

It is probably the most uncontested fact about cacao: Africa is its major supplier. Cote d’Ivoire and Ghana alone produce over 50% of the world’s cacao. When the nations of Nigeria and Cameroon are included in this unbalanced equation, the total contribution to cacao production stands at 70% (Intergovernmental Panel on Climate Change (IPCC); Schmitz & Shapiro, 2012; Barometer Consortium; Laderach, Martinez-Valle, Schroth, & Castro, 2013). In other words, there is a lot of chocolate at stake in Africa! And yet, the “entire African continent is the least studied region in terms of ecosystem dynamics and climate variability” (Anyah & Qiu, 2012, p.347). This is even after projections and the Global Climate Model (GCM) predict Africa to be in a very precarious position following extreme weather patterns, including long-term droughts (IPCC). This is especially troubling considering that the majority of Africa’s crops are rain-fed (Anyah et al., 2012). Connolly, Boutin, and Smit (2015) describe a 20-50% drop in cacao yield by 2050. While we cannot control the weather or be certain about cacao yield predictions, researchers have offered various solutions to buffer some of the impacts from climate change and global warming. This report will present some of these solutions and highlight a case study in Bahia, Brazil, where a resurgence in cacao production is occurring-this, after having experienced a crippling blow. The spotlight needs to be on Africa, especially its biggest cacao-producing countries and states, to ensure the future of cacao, its farmers, and ultimately chocolate.

Western Africa: An agriculture-based economy

According to Hamzat, Olaiya, Sanusi, & Adedeji (2006), the survival of cacao in West Africa up till now is entirely due to the Forastero Amazon strain introduced by Posnette (a plant pathologist credited with saving the West African cocoa industry)* and the West African Cocoa Research Institute (WASRI) in the mid-20th century (p.18). One of the major issues that arise from an agriculture-based economy are pests and diseases which can devastate crops. Black Pod Disease and Cocoa Swollen Shoot Disease (CSSV) are the two prominent diseases affecting the cacao crop in western Africa (Hamzat et al., 2006). Farm-maintenance management practices have also been known to inadvertently attract pests (i.e. brown and black cocoa mirids). It might seem like a terrible paradox, but food scarcity is also a major problem in an agriculture-based economy like western Africa’s, considering that “cocoa occupies 2.4 million hectares in Cote d’Ivoire and 1.5 million in Ghana, more than in any other country in the world” (Laderach et al., 2013, p.842). Farmers in this region usually do not combine and/or rotate crops and are left without food supply, detrimentally affecting their nutritional intake (Schmitz et al., 2012). The fact that most cacao farmers are producing on a small-scale also comes into play: in Nigeria, small holdings of farmers account for 60% of Nigeria’s total (cacao) output. Most of these farmers are in remote, rural areas and do not have access to the best seedlings or the equipment/infrastructure needed to produce higher, better quality yield (Hamzat et al., 2006). According to Hamzat et al. (2006), these farmers have a difficult time obtaining credit to make the necessary improvements. This might not appear to be a deal breaker considering that most small cacao farmers have been in business for years without high-tech machinery assisting them, but Schmitz & Shapiro (2012) state that modern farming techniques can make a drastic difference; at least 1,000 kilograms per hectare or more. At the same time, the next generation of would-be (cacao) farmers are leaving the rural areas en masse (Hamzat et al., 2006). The rural-to-urban migration is largely influenced by the fluctuating price of cocoa and the fact that cocoa is very labor intensive and the crop itself is fickle and susceptible to disease (Hamzat et al., 2006). This situation results in an aging farmer population who are less willing to adapt their farming techniques to produce more cacao and are looking to leaving the cacao industry altogether. West Africa’s history with cacao is not particularly rosy either- the use of child slave labor uncovered as late as 2000’s, has blacklisted the region.

Black Pod Disease.jpg Black Pod Disease

Photo Credit: Schmitz, H. & Shapiro, H.Y. (2012). 

Africa will also have to contend with a projected population boom (Miller, Waha, Bondeau, Heinke (2014). This may interrupt the cacao industry in that farmers will be forced to grow food, rather than their cash crop. The surge in population might also alter farming completely in that water will become an even more precious resource not to be wasted on cacao farms. Together, these social, economic, and technical issues will be exacerbated with the addition of above-average climate change for the region in the 21st century.

*To read more about Dr. A.F. Posnette, visit http://www.telegraph.co.uk/news/obituaries/1467914/Peter-Posnette.html

Rising demand and the major chocolate actors in West African

The sustainability of cacao is a topic at the forefront of Big Chocolate, namely Mars and Hershey. Schmitz & Shapiro (2012), scientists working on behalf of Mars, quantify the expected increase in world-wide chocolate demand: “currently, farmers produce approximately 3.7 million metric tons of cocoa, where expected demand is said to reach over 4 million metric tons of cocoa by 2020 (p.62-63). Due in part to this pressing timeline, Mars has connected with scientists, universities, the World Cocoa Foundation (WCF) and even the U.S. Department of Agriculture (USDA) to essentially “save” chocolate. Mars and Hershey have both committed to buying 100% of their cacao supply from farms using sustainable practices by 2020. To qualify “sustainable,” Mars and Hershey have partnered with The Fair Trade Foundation. Of course, there are many equity (and other) issues surrounding Fair Trade (see Prof. Martin’s April 6, 2016 lecture). For the past 50 years, Hershey has bought the bulk of their cacao from Ghana and Cote d’Ivoire (Hershey Cocoa Sustainability Strategy). These big chocolate corporations have provided funding to organizations like Fair Trade to “help cocoa farmers improve their processes, yield, and profits” (DesMarais, 2014). While cocoa farmers in Ghana and Cote d’Ivoire are benefitting from the help extended to them by Big Chocolate, Hershey and Mars have plenty to lose if the cocoa crop is neglected in this region, specifically in terms of supply. Mars and Hershey (among other Big Five chocolate actors) have been vying the Chinese market for the last few years (Allen, 2009), and now, the demand from these new markets has presented more urgency regarding the sustainability of cacao in western Africa.

Cocoabarometer2015_4.png

Credit: Cocoa Barometer 2015

Is cacao’s future in the hands of science?

The World Cocoa Foundation estimates that 30-40% of the cacao crop is lost to pests and disease. With a race against time, scientists and researchers have been engineering a new super breed of cacao. With a projected rise in temperature by 2’C (or approximately 35’F) in western Africa, scientists are in search of a drought-tolerant, disease-immune cacao strain. So far, Mars and the USDA have sequenced the cacao genome in an attempt to breed hardier trees (Schmitz & Shapiro, 2012, p. 63). Critics of this super breed are worried about the flavor; CCN51, is said to be resistant to witches’ broom, but according to certain palettes (i.e. The C-spot), this breed is described as “weak basal cocoa with thin fruit overlay; lead and wood shavings; astringent and acidic pulp; quite bitter” (Schatzker, 2014). If we can appreciate anything about chocolate, it is its flavor profile and depth, making the problem of taste all the more relevant. Schatzker (2014) suggests that Big Chocolate might not be so concerned with flavor given that they can use fillers to fortify their chocolate (e.g. vegetable fat, milk, vanilla, flavor chemicals). So, to answer the question if cacao’s future is in the hands of science-certainly Big Chocolate seems to think so.

Global Efforts to boost cacao crops_scientific american

Credit: Schmitz, H. & Shapiro, H.Y. (2012). 

If the history of the coffee crop can teach us anything, however, it is that science does not always offer the best alternative. Arabica coffee, like the cacao tree, grows best under shade (they are understory trees), but when a hybrid (that could tolerate the sun) was introduced to boost the coffee bean yield, many environmental issues arose, among these: The use of herbicides and fertilizer (which led to contamination of groundwater), deforestation, and the trees having to be replaced more often (Craves, 2006).

To summarize what climate experts predict will happen by mid-century (Miller et al., 2014, p.2507):

Freshwater availability will decrease.

Flooding probability will increase.

Dry periods will increase.

Irrigation water required will increase.

Crop yield will decrease.

Scientists, at times working for Big Chocolate, hope to address these climate issues by breeding superior genotypes of Theobroma cacao. It is in the interest of the Big Five to keep up research efforts in western Africa as most of their cacao comes from this region. Again, for the past fifty years or so, Hershey and Mars have benefitted from the region, amassing fortunes; it is time they give back to the land and people that have given up so much. But keeping pace with increased demand in chocolate is not just their problem. Indeed, there are others working on behalf of chocolate. The International Group for the Genetic Improvement of Cocoa (INGENIC) has sprouted out of concern for the future of cacao and were established to collaborate and coordinate on cocoa breeding and management of germplasm resources (INGENIC). Still others, like members of the Cocoa Barometer Organization, are turning to raising awareness and education to reach consumers and farmers alike. Small-scale farmers in western Africa, already experiencing the impacts of climate change, seek some certainty for their very uncertain future, whether in the form of science or other.

Case Study: Bahia, Brazil and traditional farming

Brazilian cacao farmers call it “cabruca.” It is their traditional method of farming cacao-using the shade of other food crop and timber trees, they have maximized the use of the land. Another name for this form of farming is known as mixed agroforestry systems. This method of farming is known to improve the water-holding capacity of the trees (Schmitz & Shapiro, 2012). It is sustainable and environmentally-friendly because 1. It provides corridors for wildlife increasing biodiversity; 2. The trees and surrounding plants capture more carbon; 3. It generally requires less water; and 4. More of the (dwindling) forest is preserved (Sambuichi, Vidal, Piasentin, Jardim, Viana, Menezes, Mello, Ahnert & Baligar, 2012; Schroth, Faria, Araujo, Bede, Van Bael, Cassano, Oliveira, & Delabie, 2011). Bahia is also currently experimenting with a second method: planting cacao trees at higher altitudes, out of pests’ normal range (Schmitz & Shapiro, 2012). In the 1980’s, this region of Brazil experienced a devastating blow to their prized cacao crop-a reduction of 80% in cacao yield-collapsing the cacao economy (Schmitz & Shapiro, 2012). Limited genetic variation led to a near wipeout of cacao trees in the area (most succumbed to witches’ broom). Today, Bahia, has reemerged as a contender in the cacao industry and is recognized for its flavorful cacao beans. In light of global warming, researchers have begun to explore the potential “lessons-learned” from Bahia that could be applied to western Africa; however, most agree that site-specific strategies are needed.

VC_cabrucaa_20150526_0640321-e1438163980647

Cabruca Farming

Photo Credit: eCacaos

Conclusion

Although this blog attempted to touch on the current situation regarding cacao in West Africa and cover a wide range of potential climate change scenarios projected for this region, there are probably more questions than answers. In obtaining feedback for this paper, there was a comment about global warming and climate change involving a lot of speculation. And in truth, no one can really know the impacts climate change will bring. What we can stand firm on is the fact that climate change will happen. In other words, it is not a question of if, but when. West Africa has become a living lab of sorts, but a question one might have about cacao coming from this specific region may involve the major chocolate buyers. Should we care about Big Chocolate like Hershey and Mars running out of supply? The simple answer is yes. The livelihoods of so many farmers depend on corporations like Mars to buy their product, and if organizations like Fair Trade can lead the sustainability efforts, farmers will benefit. The places cacao is sourced from may change-according to NOAA cacao can only grow within 20’ north and south of the equator today, but in the future, higher altitudes may be called for-but terroir and consistent quality cacao will always be a good selling point. It is in everyone’s best interested to be invested in the future of chocolate, cacao farmers, and the West African region in particular. Finally, it was important to introduce the Bahia case study to demonstrate how one region, in the midst of global warming projections and a near wipeout under the belts, are still finding ways to minimize their ecological footprint. We do not have to wait for 2020 or 2050 to arrive, the future of chocolate is now.

Works Cited

A.F. “Peter” Posnette. Telegraph online. Accessed from: http://www.telegraph.co.uk/news/obituaries/1467914/Peter-Posnette.html

Allen, L.L. (2009). Chocolate fortunes: The battle for the hearts, minds, and wallets of China’s consumers. New York: AMACOM.

Anti-Slavery International (2004). The Cocoa Industry in West Africa: A history of exploitation.

Anyah, R.O. & Qiu, W. (2012). Characteristic 20th and 21st century precipitation and temperature patterns and changes over the Greater Horn of Africa. International Journal of Climatology, 32.

Cocoa Barometer 2015. Accessed from: http://www.cocoabarometer.org/Home.html

Connolly-Boutin, L., & Smit, B. (2016). Climate change, food security, and livelihoods in sub-Saharan Africa. Regional Environmental Change, 16.

Craves, J. (2006, February 5). The problems with sun coffee. Accessed from: http://www.coffeehabitat.com/2006/02/the_problems_wi/

DesMarais,C. (2014, March 20). Hershey’s and Mars sweeten market for West African cocoa farmers. Greenbiz online. Accessed from: https://www.greenbiz.com/blog/2014/03/20/hersheys-mars-sweeten-market-cocoa-farmers

Hamzat, R.A., Olaiya, A.O., Sanusi, R.A., & Adedeji, A.R. (2006). State of cocoa growing, quality and research in Nigeria: Need for intervention. Presented at The Biannual Partnership Programme of the World Cocoa Foundation.

Hershey’s Cocoa Sustainability Strategy. Accessed from: https://www.thehersheycompany.com/en_us/responsibility/good-business/creating-goodness/cocoa-sustainability.html

INGENIC. Accessed from: http://www.incocoa.org/ingenic/

Intergovernmental Panel on Climate Change (IPCC). Climate Change 2013, Chapter 14. Accessed from: http://www.cocoabarometer.org/Home.html

Laderach, P., Martinez-Valle, A., Schroth, G., & Castro, N. (2012). Predicting the future climatic suitability for cocoa farming of the world’s leading producer countries, Ghana and Cote d’Ivoire. Climatic Change, 119.

Mars Sustainability Strategy. Accessed from: http://cocoasustainability.com/2015/02/mars-and-fairtrade-extend-partnership-to-certify-cocoa-for-mars-bars/

Muller, C., Waha, K. Bondeau, A. & Heinke, J. (2014). Hotspots of climate change impacts in sub-Saharan Africa and implications for adaptation and development. Global Change Biology, 20.

NOAA. Climate and chocolate. Accessed from: https://www.climate.gov/news-features/climate-and/climate-chocolate

Sambuichi, R. H. R., Vidal, D.B., Piasentin, F.B., Jardim, J.G., Viana, T.G., Menezes, A.A., Mello, D.L.N., Ahnert, D. & Baligar, V.C. (2012). Cabruca agroforests in southern Bahia, Brazil: Tree component, management practices and tree species conservation. Biodiversity Conservation, 21.

Schatzer, M. (2014, November 14). To save chocolate, scientists develop new breeds of cacao. Bloomberg Markets online. Accessed from: http://www.bloomberg.com/news/articles/2014-11-14/to-save-chocolate-scientists-develop-new-breeds-of-cacao

Schmitz, H. & Shapiro, H.Y. (2012). The future of chocolate. Scientific American.

Schroth, G., Faria, D., Araujo, M., Bede, L., Van Bael, S. A., Cassano, C.R., Oliveira, L.C., & Delabie, J.H.C. (2010). Conservation in tropical landscape mosaics: The case of the cacao landscape of southern Bahia, Brazil. Biodiversity Conservation, 20.

Silberner, J. (2007, November 19). How chocolate can save the planet. NPR online. Accessed from: http://www.npr.org/templates/story/story.php?storyId=16354380

World Cocoa Foundation (WCF). Accessed from: http://www.worldcocoafoundation.org/category/knowledge-center/manuals/

 

 

The Public Fight Over Chocolate Purity

Chocolate and sugar consumption were both generally trending upwards as the 20th century began, and attitudes about both goods were in flux. People were obsessed with pseudo-scientific categorization of their foods, in both moral and Humoral schemes. Chocolate and sugar, relatively recent imports that defied easy categorization, were a challenge. However, the Industrial Revolution brought these foods to the forefront of the consciousness of many countries, particularly America, as it allowed them to be mass-produced. Giant candy companies like Mars and Hershey grew to prominence and began to saturate the market. These companies had to try to shape their own public perceptions to combat prejudices and increase sales, though. In particular, the early 20th century was characterized by a war over the purity of chocolate between chocolate advertisements and American moralists, particularly those in newspapers. The fate of a potentially multi-billion-dollar industry hung in the balance.

The moral trepidation about chocolate and its big companies can be traced back to European roots. The Cadbury Company faced a debilitating scandal in the mid-1800’s when a Lancet study found that they were using brick dust and other impure items in their chocolate; furthermore, Cadbury was accused in the early 20th century of procuring raw materials from Brazilian islands Sao Tome and Principe, where slavery was still practiced (Lecture Notes). Though Cadbury earnestly tried to combat this stigma, the idea that chocolate companies were immoral remained omnipresent in society afterwards.

Cadbury’s issues of adulteration plagued its American cousins, too. In her article “Blame Candy” in The Chronicle of Higher Education, Samira Kawash reports that, “candy makers were suspected of cutting corners… [and] boosting the bottom line by adding fillers like plaster or sawdust…, replacing chocolate with wax or nuts with cardboard, employing toxic dyes to create eye-catching colors.” American candy makers were accused of dishonesty, a practice that seemed especially immoral when one considers that their main consumer base was children. To make matters worse, as the same author reports in a different article for The Journal of American Culture, entitled “The Candy Prophylactic, Danger, Disease, and Children’s Candy Around 1916”, a sudden epidemic of infant paralysis in 1916 was incorrectly blamed on food adulteration in the candy industry.

Indeed, as Kawash notes, “if one were to read the daily papers, it was a miracle that any candy-eating child survived.” Indeed, investigation into contemporary newspapers reveals a multitude of headlines linking candy with death. Some include, “Baby Chokes to Death on Peanut in Candy” (Chicago Tribune, July 13, 1925), “Boy Eats Candy, Dies” (Washington Post, June 26, 1921) and “Seven Escape Death From Poisoned Candy” (Baltimore Sun, January 5, 1924). The immorality of candy did not even stop with adulteration of food. In 1937, New York mayor Henry LaGuardia declared war on New York penny candy sellers, claiming that they were taking advantage of children by selling them candy with the lure of potential prizes to lucky purchasers (foodtimeline.org). In the 1920’s and 1930’s, candy had an image problem.

In order to combat this problem with their reputation, larger candy companies utilized advertisements in print publications to communicate with their public and disseminate a narrative centered around the purity of both chocolate candy and its purveyors. This advertisement in the New York Herald in 1933 provides an example of such practices:

Screen Shot 2016-03-11 at 11.57.59 PM

This full-page advertisement painstakingly spells out to consumers why Loft candies are different. The banner at the bottom proclaims that “Pure Candies are Better For You”, and Loft reiterates this by proclaiming its candies are “absolutely pure” in the text of the ad. Furthermore, in its proclamation that it doesn’t charge consumers for the box, Loft distances itself from any demonizing accusations about cheating consumers.

The idea of Loft being a company that treats consumers right reappears in later Loft ads, like this one.

Screen Shot 2016-03-11 at 11.58.44 PM.png

The banner at the bottom proclaims that, “Loft has 150 stores to serve you right” and the emphasis on the ad remains firmly on the consumer, who is addressed with repeated use of the word “you”. Phrases like “You’ll find that Loft is the best candy for you” and the “Loft Guarantee” that “if you ever ate better candies at double the price, bring back the empty box and Loft will cheerfully refund your money.” The implication here is that Loft is not a company out for its own selfish aims—it simply wants to give you the best candy possible.

Large candy companies even went to lengths to deflect the negative stereotypes associated with candy onto their local competition. Though big companies were implicated in impurity accusations, they wanted to perpetuate the narrative that bigger company products were more reliable than shoddily-crafted corner store alternatives. One Mars ad provides an example of such practices.        

Screen Shot 2016-03-11 at 11.59.57 PM

With a full page to work with, this ad utilizes a multitude of tactics in order to get its point across. It underscores traditional notions of maternal mothers watching out for their children and paternal fathers understanding how business works. It makes the point that not only is the candy-maker in question immoral for cutting corners in his production, he is a bad businessman for not selling Mars bars, which would sell out quicker. The implications of the ad are strong. Mars bars are reliable and delicious—it is the alternatives that parents should worry about.

In the 1920’s and 1930’s, American chocolate companies sought to distance themselves from notions of impurity and impropriety that had long pursued their brands. Newspapers and moralists were quick to blame candy companies for deaths and the degradation of society, and chocolate companies sought to break this narrative in their print advertisements. This war determined the future of the candy industry, which, thanks in large part to its less deadly current reputation, is thriving.

Works Cited: 

Kawash, Samira. “Blame Candy.” The Chronicle of Higher Education 60.08 (2013). Biography in Context. Web. 12 Mar. 2016.

Kawash, S. (2010), The Candy Prophylactic: Danger, Disease, and Children’s Candy Around 1916. The Journal of American Culture, 33: 167–182. doi: 10.1111/j.1542-734X.2010.00742.x

“Penny Candy”, Food Timeline. http://www.foodtimeline.org/foodcandy.html#modernamericancandy

“Display Ad 58–No Title”. Daily Boston Globe (1928-1960); May 18, 1933; ProQuest Historical Newspapers: The Boston Globe.

“Display Ad 62–No Title”. New York Herald Tribune (1926-1962); Oct 20, 1933; Proquest Historical Newspapers: New York Tribune/Herald Tribune

“Display Ad 24–No Title”. New York Herald Tribune (1926-1962); Jun 3, 1933; Proquest Historical Newspapers: New York Tribune/Herald Tribune

“Search Results: ‘Candy’, ‘Death’; Publication date: 1920-1929”. ProQuest Historical Newspapers

 

 

 

 

 

 

 

Unwrapping Chocolate Potential in the East: How Foreign Companies Wooed Chinese Consumers

Chocolate was introduced to Europe in the 16th century but it was not until the end of the 20th century that the godly good made its way to China. By the end of the 20th century, China had undergone dramatic social and economic expansion, and the world’s largest chocolate companies (the “Big Five”: Ferrero SpA, Cadbury, Hershey Co., Nestlé SA, and Mars Inc.) recognized the potential of introducing chocolate to the Chinese market (Allen 202). At the time however, chocolate had no history or tradition in China, thus highlighting the importance of finding a meaningful way of introducing the good. The “Big Five” companies needed to have a profound understanding of cultural differences in order to do so (Nelson). Moreover, these companies faced numerous challenges in regards to supply chain management and distribution. Depicting how global chocolate companies attempted to gain commercial success in China highlights the intricate nature of developing into an emerging market. This also enhances our understanding of the strategies these companies will embrace as they expand further.

chocolate-heart
Gift Giving – A Cultural Gateway

Culinary traditions were very different in China and chocolate companies were challenged to find a meaningful way of introducing chocolate to the Chinese market (Allen 23). The big five chocolate companies recognized that gift giving was universal throughout China and could serve as the cultural gateway for introducing chocolate. With this is mind, chocolate companies targeted their marketing efforts toward affluent Chinese consumers and developed elaborate packaging designs to appeal to this consumer base (Allen 25).

Although many affluent Chinese consumers were willing to justify the expense of chocolate for gift giving, chocolate companies recognized that self-consumption could generate even greater profits across a variety of social classes. In established markets in other countries, self-consumption accounts for approximately 90 percent of total sales (Allen 26). In China in the 90s however, gift giving accounted for more than 50 percent of total sales, thus highlighting enormous potential for expansion into the self-consumption market! China’s economy grew substantially in the 1990s and consumers subsequently started having more pocket money. In addition, young Chinese started familiarizing themselves with Western culture and food. These social and economic changes conveniently facilitated the introduction of chocolate to the mass market in China (Allen 27).

Mars’s Master Strategy

Today, the American company Mars is the leading chocolate business in China and a number of factors allowed Mars to get ahead of its competitors. First, Mars introduced the Dove chocolate bar, the earliest chocolate product aimed for self-consumption (Allen 200). This bar allowed Mars to establish legitimacy and build loyalty among young Chinese people (Allen 21). Moreover, Mars has embraced an aggressive expansion strategy of manufacturing in China along with aggressive media and marketing initiatives primarily to build up its Dove and Snickers brand (Lannes and Blasberg)

Screen Shot 2016-03-11 at 6.59.42 PM
Mars was the official sponsor and exclusive supplier of chocolate bars during the 2008 Olympics in Beijing, representing one of many successful recent marketing initiatives.

In addition to recognizing the value of branding, Mars has also undergone some organizational changes that lowered distribution costs. The recent acquisition of the gum company Wrigley’s, resulted in the formation of the leading retail confectionary company and gave Mars extensive distribution and sales operations networks (Allen 211-212). This recent merger ultimately allowed Mars to strengthen the company’s position as the leading chocolate company in China.

This campaign, which encourages consumers to create a love art piece by using Dove’s boxes, went viral on social media, exemplifying the success of Mars’s marketing efforts.

Looking Ahead

Today, the Chinese chocolate market represents a relatively small share of global chocolate consumption. However, the country’s sales potential is huge, given that a larger proportion of the country’s population is becoming potential chocolate consumers (Allen 202; Cohen). During the last three decades, the “Big Five” companies have built brand awareness and it seems unlikely that other global chocolate companies will be able to break into the market (Allen 22). Although local Chinese competitors have lower operating costs and can thus set lower prices, it seems unlikely that these companies are an immense threat to the “Big Five” (Allen 213).

China’s market has enormous growth potential and there are two major strategies that chocolate companies can adopt to strengthen their position. First, chocolate companies should sustain business in first-tier cities and fine-tune sales and marketing efforts (Allen 202; Nelson). Secondly, chocolate companies should consider expanding to second-tier cities (Allen 202; Nelson). Supermarkets represent a new exciting distribution channel, but it will be imperative to address challenges in regards to infrastructure and product innovation to respond to the preferences and price-point of the new consumer base.

To wrap up, there is seemingly no simple recipe for success but companies that are sensitive to the varied demands of the Chinese consumers are more likely to unleash the full potential of the market.

HD16365-1.jpg

 

Works Cited

Allen, Lawrence L. Chocolate Fortunes: The Battle for the Hearts, Minds, and Wallets of China’s Consumers. New York: American Management Association, 2010. Print.

Cohen, Luc. “China Chocolate Market Seen Growing to $4.3bln by 2019-Hershey.” Reuters. 18 February 2015. Web. 11 March 2016.

Lannes, Bruno, and John Blasberg. “Gold Medal Brands.” Bain & Company Insights. July 1 2008. Web. 11 March. 2016.

Nelson, Christina. “Chocolate Fortunes.” China Business Review. July 1 2008. Web. 11 March 2016.

Media Sources

Chocolate candy hearts. Digital Image. http://torange.biz/16365.html. Web. 11 March. 2016

Chocolate Heart. Digital Image. http://www.publicdomainpictures.net/view-image.php?image=20869&picture=chocolate-heart. Web. 11 March. 2016.

Kestrel Lee. “Dove Chocolate’s Valentine’s Day Campaign”. Online video clip. YouTube. YouTube, 9 January 2012. Web. March 11. 2016.

Snickers hospitality Team. Digital Image. http://www.sportsworld.co.uk/clients/snickers-beijing-olympics-2008. Web. 11 March. 2016

 

Chocolate’s Expansion Beyond Europe

Despite chocolate’s wide availability in Mayan culture, the European chocolate experience was much like that of the Aztecs: chocolate was mostly a drink restricted to the elite. Eventually, however, chocolate would spread to every strata of society and even to countries that previously rejected the chocolate tradition. How did chocolate win over the economies and hearts of cultures worldwide? Chocolate’s expansion beyond Europe was made possible by two factors–mechanization and culturally-relevant marketing strategies.

In the Baroque era, chocolate failed to become a popular drink outside of Europe (Clarence-Smith). Even inside Europe, chocolate had to fight for attention with tea and coffee, two other foods that were held in higher esteem. In fact, while chocolate was associated with aristocratic excess, tea and coffee were seen as drinks that represented “sobriety, serious purpose, trustworthiness, and respectability” (Clarence-Smith). Art depicting chocolate during this era reflects how chocolate was seen as part of a ritual reserved for higher-class persons, especially women (see media below). However, in areas under Spanish influence (such as the Phillipines), chocolate enjoyed a strong favoritism among the population. Yet chocolate would fail to take root as a popular food in the rest of Asia, perhaps due to the overwhelming Confucian tea tradition prevalent in East Asia.

Woman pouring chocolate from a 18th-century painting. Wikimedia Commons license.

But the mid-1800’s would see the beginnings of a revolution that would allow chocolate to be made cheaper, to be molded into unique forms, and expand beyond the higher and middle classes. The invention of conching, powdered forms of cocoa, and chocolate in bar form allowed chocolate to be made more rapidly and at a price point that was friendlier to the lower classes. At the same time, chocolate began being revered as a source of protein. “British workman cocoa houses were” being built to cater to the common laborer (Clarence-Smith) and militaries began providing chocolate bars as part of soldiers’ rations. As a result of falling prices and more diversification of chocolate forms, lower classes could afford more of the substance in chocolate’s various incarnations. Advances in transportation and a move towards closed storefronts allowed chocolate to travel intact across countries and into the hands of consumers (Goody).

Despite the lower prices for chocolate and its increasing ubiquity thanks to mechanization, markets in East Asia remained closed to chocolate companies until well into the 20th century. By this time, America was thoroughly hooked on chocolate, with even the National Confectioners’ Association running ads encouraging the daily partaking of chocolate (Martin). Mars was the first to attempt to bring this type of campaign to East Asia. Mars’ executives knew that China held an untapped chocolate market, and they decided to make a splash by using big marketing tactics. Mars’ first move was establishing a representative office in Beijing during the Asian games and sponsoring sports—which led to M&M’s becoming the official snack food of the 1990 Games.

Other chocolate companies were also eager to move into China and East Asia, and they incorporated several clever marketing strategies to fuel Asian consumers’ taste for chocolate. In the 1950’s confectioners hit upon a marketing nerve that resonated with Japanese consumers: they marketed Valentine’s Day as a chance for women to show affection towards men. For a woman to reveal her feelings towards a man was considered radical in Japanese culture at that time. Confectioners cleverly created a day where it was “acceptable” for women to express their feelings (Just Hungry). This type of marketing tapped into cultural traditions and expectations, showcasing how confectioners adapted to the culture of East Asian countries in order to make sales. Confectioners also used unique marketing strategies such as sponsoring an artist who went viral with his design for a heart-shaped carriage (Martin). By tapping into cultural mindsets and encouraging grassroots expansion, chocolatiers were able to edge into the Asian market.

Today, chocolate is finally hitting the sweet spot in Asia. Confectioners have expanded on the practice of “obligation” gift-giving in certain cultures and heavily marketed occasions where chocolate gifts are an obligatory treat. For instance, on Valentine’s Day, women in Japan are expected to give “giri chocolate” to males to whom they have no romantic feelings whatsoever, such as their bosses or mentors (Just Hungry). Marketers have gone even further and created a “White Day” where men could return the favor and gift women with chocolates and candy.

Here is a photo of giri choco, which is Japanese for “obligation chocolate”—the kind of chocolate women must give to men whom they have no romantic interest in. Flickr attribution/non-commercial license.

Far from being an elite food today, chocolate has crossed from the drawing rooms of Spanish and French nobility and emerged as a global product. Its entrance into East Asia was facilitated by 19th century advances in production and enabled through the use of marketing tactics that created a cultural fever for the sweet treat.


Sources:

Clarence-Smith, William Gervase. Cocoa and Chocolate, 1765-1914. 2000. Print.

Goody, Jack. “Industrial Food: Towards the Development of a World Cuisine.” 2013 (1982). Print.

Just Hungry. “The Japanese Valentine’s Day tradition of compartmentalized chocolate giving.” 8 Feb. 2016. http://justhungry.com/uniquely-japanese-valentines-day-tradition-compartmentalized-chocolate-giving. Online.

Martin, Carla. “Chocolate, Culture, and the Politics of Food Lecture Slides 2016.” 2016. Online.

 

Sugar, Milk, and the Rise of Mass Chocolate Consumption

Walk into any convenience or grocery store in the U.S. and you will likely be greeted by a display of brightly wrapped candies. Many of these contain chocolate; a 2012 Bloomberg study found M&Ms to be the top-selling American candy, followed by Reese’s Peanut Butter Cups, Hershey’s Milk Chocolate, and Snickers Bars (Arndt). All four of these products are marketed as chocolate-based sweets, but it is sweetness, not chocolate, that seems to be the main focus. The nutrition label for a Hershey’s Milk Chocolate Bar, for example034000290055NF (pictured right), lists sugar as the primary ingredient, and then milk. Only after these two does chocolate appear. The addition of sugar and milk to eating chocolate goes back to the 1800s, largely motivated by that fact that, in a trend that continues to this day, cacao was more expensive than sugar or milk. It was the relative cheapness of the latter two ingredients that allowed for mass production – and thus true mass consumption – of eating chocolate from the late 1800s onwards. As the list of candies above attests, this combination still shapes modern chocolate preferences.

Europeans have been adding sugar to drinking chocolate since the early 1500s, when cacao was first introduced to the West. It comes as no surprise, then, that the first chocolate bar made expressly for eating, invented by Joseph Fry in 1847, was molded from a combination of cocoa powder, melted cacao butter, and sugar (Coe and Coe Ch.8, “Quaker Capitalists”). Soon after, in 1867, Henri Nestlé found a way to manufacture

petersgalachocolate
Peter’s Milk Chocolate was the first of its kind to be created. This advertisement draws on words like “smooth” and “creamy” to draw customers in, adjectives that are still associated with milk chocolate. The relatively lower price on this and subsequent milk chocolate bars meant they could be marketed to customers other than the very wealthy.

powdered milk, and the first milk chocolate bar – an advertisement for which is shown on the left – a joint creation of Nestlé and Daniel Peter, was born in 1879 (Coe and Coe Ch.8, “Switzerland”). From 1903 onwards, Milton Hershey built his company around milk chocolate and cocoa powder, though he developed his chocolate using liquid condensed milk rather than the powdered variety. Liquid milk was easier and faster – and therefore cheaper – to transport from one end of a factory to another, allowing Hershey to make and sell his products domestically for a lower price (D’Antonio 107).

 

Milk chocolate was to become the foundation of popular chocolate consumption,

cocoa_may_2012_1
Cacao prices from 2006-2012, recorded in USD/metric ton

originally for price but later because of a developed taste for the added sweetness. To make it, one adds milk in with the other ingredients before refining and conching the mixture. Milk and sugar both add flavor and volume, allowing manufacturers to use less chocolate liquor – made from cacao beans – than would otherwise be needed (Coe and Coe Ch.8, “Quality vs. Quantity”). This makes the chocolate cheaper to produce, and men like Hershey would have recognized this when building companies. Over the past century, cacao has generally been more expensive than sugar or milk. The trend

sugar_price_1
Sugar prices from 2002-2009, recorded in US cents/lb. Comparatively, a ton of sugar is much less expensive than a ton of cacao

continues on in today’s market, as shown by the provided graphs (cacao above right, sugar on the left). At its lowest price between 2006 and 2012, a ton of cacao cost over 15,000 USD; by contrast, at its highest price over the similar time period 2002-2009, a ton of sugar (after conversion from cents/lb) could be bought for less than 500 USD.

 

 

Milk and sugar were thus cheaper to obtain for companies looking to mass produce chocolate after the late 1800s. This made sweet milk chocolate less expensive to make than dark chocolate, which required more chocolate liquor. By the same token, it also meant milk chocolate could be sold at lower prices, making it attractive and accessible to consumers. Where before chocolate had been largely consumed by the wealthy, Hershey’s bars could be bought for only a nickel in the 1920s, a very affordable fee for the average person (Brenner 55). Cost was thus an important consideration on both sides, as the success of Mars’ Milky Way further demonstrates. Created in 1924, the Milky Way “tasted just as chocolatey” as a bar but was much less expensive to manufacture (Brenner 55). It’s main ingredient was nougat, “a whipped filling made of egg whites and corn syrup,” with only a thin chocolate casing (Brenner 54). Nougat was cheaper to produce than chocolate, and so Mars could make Milky Ways much bigger than traditional chocolate bars for the same expense. Consumers loved the candy for its price, size, and sweet taste; another Mars creation, the Snickers bar, enjoyed similar success, and continues to be the fourth best-selling candy in the U.S. (Arndt).

Today, milk chocolate candies remain vastly more popular than their dark chocolate counterparts. Although price remains a factor, a major reason for this is the acquired tastes of consumers for sweeter chocolate. It is expected that candy and chocolate will be packed with sugar, and this assumption stems from over a century of eating the sweetened milk chocolate of Hershey’s, Mars, Cadbury, and other such companies. The practice of adding milk and sugar stemmed from the cost of these ingredients relative to cacao, and what began as a method for cheaply producing chocolate has grown to shape the Western world’s perception of chocolate. Although dark chocolate has a strong following, milk chocolate still reigns supreme.

Sources:

Arndt, Michael. “America’s 25 Favorite Candies: Top-Selling Sweets.” Bloomberg.com. Bloomberg. Web. 07 Mar. 2016. <http://www.bloomberg.com/ss/09/10/1021_americas_25_top_selling_candies/index.htm&gt;.

Brenner, Joël Glenn. The Emperors of Chocolate: Inside the Secret World of Hershey and Mars. New York: Random House, 1999. Print.

Coe, Sophie D., and Michael D. Coe. The True History of Chocolate. 3rd ed. London: Thames & Hudson, 2013. E-book.

D’Antonio, Michael. Hershey: Milton S. Hershey’s Extraordinary Life of Wealth, Empire, and Utopian Dreams. New York: Simon & Schuster, 2006. Print.

Multimedia Sources:

Hershey Bar Nutrition Facts: “Hershey’s Milk Chocolate Bars, Six 1.55-Ounce Bars – MyQuickMart.” MyQuickMart. Web. 08 Mar. 2016. <http://www.myquickmart.com/products/034000290055&gt;.

Peter Milk Chocolate Advertisement: “Milk Chocolate – History of Milk Chocolate.” What’s Cooking America. Web. 08 Mar. 2016. <http://whatscookingamerica.net/History/MilkChocolate.htm&gt;.

Cocoa price graph: “Cocoa Growing Region.” Web. 08 Mar. 2016. <http://www.thaiembassyuk.org.uk/activities/cocoa-growing-region&gt;.

Sugar price graph: “Imbalance between Supply and Demand Drives Sugar Prices to 28 Year High | Economics.” Web. 08 Mar. 2016. <http://www.tutor2u.net/economics/blog/imbalance-between-supply-and-demand-drives-sugar-prices-to-28-year-high&gt;.